While the business media continue to babble about bottom-fishing for values in this market, the financial sector is getting hit hard. Freddie Mac (FRE - commentary - Cramer's Take) and Fannie Mae (FNM - commentary - Cramer's Take) are taking a real pounding as concerns grow over their ability to raise capital, and even industry standout Goldman Sachs (GS - commentary - Cramer's Take) is trading off sharply. It sure looks like the market is anticipating some more bad news for the financials, and until it hits, this market is not going to go anywhere.
A lot of folks are looking for a bounce, but we can't seem to get the sort of panic spike that causes volatility to jump and the remaining optimists to surrender hope. Keep in mind that if we do get some sort of panic or capitulation, it is not going to be easy to buy. It will feel like the world is coming to an end and the inclination will be to run for safety, not to jump in and do some buying.
I'm sitting almost completely in cash, waiting for opportunities. The big danger is acting prematurely, and I'm staying very aware of that fact.
Rev Shark Blog Let the Charts Show the Way 7/7/2008 12:19 PM EDT Much of Wall Street disputes the importance of charts, but without a good one, stocks will go nowhere.
Rev Shark Blog A Suspect Bounce 7/7/2008 10:11 AM EDT Can the bulls keep it up today?
Rev Shark Blog What's Your Time Frame? 7/7/2008 8:04 AM EDT It'll define how you play this sickly market.
James "Rev Shark" DePorre is the author of Invest Like a Shark: How a Deaf Guy with No Job and Limited Capital made a Fortune Investing in the Stock Market. He is founder and CEO of Shark Asset Management, an investment management firm, and he also operates sharkinvesting.com, an interactive online community that serves and educates active investors. DePorre holds business and law degrees from the University of Michigan, is a member of the Michigan Bar Association and a former tax attorney and CPA. He lives in Anna Maria Island, Fla., with his wife and two children. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Rev Shark appreciates your feedback; click here.
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