We had an unusual amount of intraday volatility today. The point move wasn't that big, but we see-sawed up and down quite a few times today, as market players scratched their heads and tried to figure out what they wanted to do. At the end of the day, the sellers prevailed, and we closed very weak.
The big problem now is that we don't have any positive news catalysts to drive things. We had a big dose of hope injected by the Fed moves last week, but now there isn't anything else to hold us up, so down the slope of hope we slide.
This is typical bear-market action, with plenty of folks being very quick to proclaim last week that the bottom was in. It is possible, but the bulls have the burden of proof and aren't doing a very good job of carrying it at the moment.
I would much prefer to be one of those pundits who is anxious to tell you how things are looking better, but I think it is far more important that you protect your precious capital until we can have much greater confidence that some sustained upside is to come. Calling bottoms is great for getting attention, but more often than not, it is a disservice to serious investors who are looking to invest when the odds are in their favor.
Have a good evening. I'll see you tomorrow.
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.
