Some of the experts were predicting that the market would be going through a correction in the first month of the new year and now you have the opportunity to add to your portfolio at some bargain prices.
After the worst start in history for U.S. stocks, everyone will be searching for meaning. One strategy has worked for almost seven years, but what about now?
Is it time to “buy the dip?”
Prior Theme Recap
In my last WTWA, I predicted that the start of a new year would focus attention on one of the several different “January effects.” This proved to be a secondary consideration. Instead, news from China rippled around the world, pressuring U.S. trading before Monday’s opening. The China story continued through Thursday. Even a strong employment report on Friday could not reverse the selling pressure. There are some still debating the seasonal effects, but it was a minor theme last week. You can see the sad story for stocks from Doug Short’s weekly chart. (With the ever-increasing effects from foreign markets, you should also add Doug’s World Markets Weekend Update to your reading list).