tactical trader

What an interesting (and expensive) few weeks it has been, markets the world over have seen the most intensive periods of selling in some time, especially the emerging Asian and European hot spots. But what next? Nobody really knows of course and even if they did I doubt they would tell the likes of you and me. Despite this lack of reliable guidance I have spent the last week reading just about everything I could get my hands on that sets out to explain what happened, particularly in looking for someone or something to blame, and what comes next.

I decided it might be useful to share this with our readers as not everyone has the luxury of being able to do this on a full time basis. I attach no endorsement to much of what I bring to your attention, you must make your own decisions but neither will I shy away from telling you what I think and what I am going to do. Please also keep in mind that this only relates to the position and longer term holdings, there is plenty of intraday action right now without me needing to comment on it.

Most talk has been of an inevitable correction, that markets have been overheated for some time and we should all have expected this to happen, especially with precious metals. The talk of a bottom being reached and a recovery being the order of the day possibly in a few weeks and certainly no later than October could just be wishful thinking or it could be a perfectly reasonable scenario.

Personally I am backing this and see the whole thing as a serious buying opportunity in waiting. Fundamentally little has changed and despite the howls of protest from the TA brigade there is no doubt that these will win out in the end. One of the most amusing things of the last week has been the scurrying for cover of the Technical Analysts only for them to emerge with yet another dazzling array of charts to show how this was predicted in the tea leaves. What a pity they could not predict this before it happened.

Please do not get me wrong, I have nothing against TA provided it is used in context and along with all the other factors that shape markets, the work of people like Robin Griffiths and David Fuller are excellent examples of this approach. In fact it was Griffiths who, during April, told us to get out of India, at least temporarily. How right he was.

Over the next few days I am going extract all the key points from my research and will be putting together an action plan for my portfolio, I will share this with you along with any insights I glean along the way. I hope it helps.