Saturday, August 08, 2015

Market Pain Is Increasing

The market volatility and decline is starting to worry me.      At first, I believed the market was similar to 2012, i.e. lots of volatility but still finishing higher.    However, I'm starting to believe 2015 is going to be more like 2008, i.e. lots of volatility and a big downward spike.  The main difference from 2008 is that market indices are still near the all time highs highs.

One argument against a significant decline is that almost everyone expects one to happen.  In fact, many of the pundits turned negative on the market over the last couple weeks.  Often, high negative sentiment is a good contrarian indicator that a market correction time frame is not near.  And the sentiment seems very negative at this time.

At this point, I'm still in a wait and see mode.  I'm ready for a downturn and trying to prepare myself to buy should there be a 20% or greater drop.   Hopefully, if there is a significant drop, I will have the discipline to put some funds into the market.

For more on Reflections and Musings, check back Saturdays for a new segment.

This is not financial advice. Please consult a professional advisor.

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