On being patient and waiting for it
Last week I wrote: “But that doesn’t mean we won’t see DJIA 15,000 and/or more panic sell-offs before then. I’ve nibbled on the names I want and added SIMO as a play on the Wearables and Internet of Things revolutions to the portfolio recently and while the markets are down big again today, I don’t see any of my stocks that scream at me to rush into more. One more whoosh down, maybe a -500 day on the DJIA or something with another wave of panic selling like we had back when we were able to sneak and add to our Apple, Google and Amazon longs back when they got crushed on that -1000 day on the DJIA a month ago — and I’ll likely step up and buy more aggressively. No trades for me today so far though.”
Stocks are down more since then and down again this morning. And we’re not there yet, despite seeing many stocks out there -3% again today and many at new lows.
While I’m still beating myself up for not having nailed the recent near-term top with some puts and even more aggressive selling on my part, I do note that we’ve been well served by having avoided the energy patch entirely and my constant focus on not just “strong” balance sheets but balance sheets that have positive net cash per share is currently revealing itself to once again be of the utmost importance as the energy/commodity cycle topped.
Back in January, I wrote an article called “Don’t buy energy stocks until the bankruptcies start.”
This week on Marketwatch: “How Many More Oil & Gas Companies Will File for Bankruptcy?”
Energy stocks are down huge from their highs and down huge since January and down huge since last month and down huge again today.
There’s a lot of discussion on the Trading With Cody chat room about how few bulls there are out there right now and how scared everybody is. The fact is that is a good indicator that we’re learning out lessons well as we try to see past the market action.
As for my own moves, or lack thereof, I’m I’m sticking to my guns for now and waiting for a near 500 point sell-off. I see some of our stocks close to lower lows that might become tempting, but I made some nice buys during that last 1000 point sell-off day a month ago and nibbling here and there since. Patience is often the most profitable stance to take.
More to come.
