Here's Why I Still Think You Should Wait For A Correction Before Buying
Autor: Ur
Data: 15-10-2003 02:55
Looking to the indices, on Tuesday, the Nasdaq (NasdaqSC^IXIC - News) opened lower but quickly found its low. It then worked it way higher in a choppy fashion throughout the day. This action has it closing well and at new highs for the year once again.
Looking to the sectors, many remain at or near 52-week highs. This includes (but is not limited to): broker/dealer, most financials, insurance, computer hardware, major oils, metals and mining (less gold and silver), transportation (regional air is in a strong uptrend), banks, retail, homebuilders, Internet, telecom (most sub-sectors), and software (most areas).
So what do we do? With the indices at new highs for the year and the overwhelming number of sectors in uptrends, you'd think I'd be a bull. Well, I am, sort of. The big blue arrow points higher but shorter-term, I still think the market needs to (and will) correct for those overbought reasons given recently. And, at the risk of preaching, I don't think that buying an overbought market is prudent. Therefore, my commentary continues to remain the same: On the long side, wait for a correction (don't worry, even if the market thumbs its nose at all these indicators and blasts to new highs, I can assure you that there will be an opportunity on the first pullback). And, once again, on the short side, for the aggressive (or those looking to hedge longs), continue to look for a possible trade in the index shares should they show signs of reversing.
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