Here is the link.
David Ryan's Masterclass-- Bear Market Strategy (1990-91 as example for 3 leg down)
Compare it to Home Depo(HD)-; beautiful leader; COST;MSFT; IGT Background info: 1991 is known as the year of Cup with Handle, dubbed by IBD As the bear market starts from 1990, and end at 1991 Feb, many stocks form perfect cup with handle which provides perfect buy point Rule 1: try not to lose lots of money; don't give up everything you get from prior bull market Rule 2: Focus on price action of the stocks instead of fundamentals Rule 3: Typical bear market usually have 3 separate phases or legs of decline, interrupted by a couple of rally just long enough to convince investors to begin buying some of the bear market rally could last as long as 15 weeks Rule 4: Do not try to pick the exact bottom. It is much better to be late and wait for the market to build a bottom. The goal is not to pick bottom day; but wait for the turn to setup since there might be several testing of the low Look for high volume buying and low volume selling as a clue of the market bottoming Rule 5: Watch out for the rally and retest. You might try to buy the rally with the leaders but the retest will shake you out(eg MSFT, also DOCU in 2020). That is when pessimism sets in and we have a possible turn. Prepare to step in and buy the pivot reset Rule 6: The bigger the drop, the longer it takes to recover and base. People need time to regain their confidence. Rule 7: CASH IS GOOD. Cash is a good place to be in a bear market. It is about capital preservation 99% of the money is made in bull market, not bear market. Rule 8: always be on the lookout for the potential leader in the next market Rule 9: use the sit out time to study past winners and do post analysis on your recent trades to improve your trading
No comments:
Post a Comment