CHESSNOID

I love reading the business news and trying to make heads and tails of it and figure out what the economy has in store for us. I am usually a positive person and for a moment I thought I was being negative by repeating all the headlines about a recession. Then I realized my critical thinking is not negative but an ability to understand news and possibly make money on it.

You know you always hear about how to make money in the stock market whether it is going up or down, but think yeah yeah yeah… Just like those real estate guys on late night TV talking about making money with no money down. If you had actually jumped in the market 6 or 7 years ago and bought as many properties as possible, you would of made a killing. The hard part is just getting rid of it or cashing out at the right time to lock in your profits. This time I did cash out of the stock market 2 months early to lock in my gains. I did miss the rest of the uptrend in the last two months of 2007, but I did manage to miss the 3 week downtrend of 2008. If I had money in stocks I would be down 10% of my entire portfolio.

Now the hard part is getting back in the market. I am not sure what my entry strategy will be yet. I am thinking about repeating what I did in the dotcom crash and start dollar cost averaging on my stock picks. Back then I picked tech stocks because they got pummeled. This time I am thinking about buying bank, real estate, and builder stocks. This strategy will allow me to buy at the cheapest time.

I also ventured into a new part of investing that is actually a little more advanced. Of course I only put a little of my portfolio in this as I learn. I have already tried doing it the armchair quarterback method. Now, I am in the novice actually doing it mode taking baby steps. I have been successful but I think it is still too early to gauge how well I can execute this strategy consistently on a long term basis. I have made 50% in one month and very pleased with that result. I definitely made some errors because I could have made 100% but because of my greed and fear, I didn’t execute the way my stock trades the way I should have. When I feel more comfortable discussing it, I will blog about it in detail. Usually, blogs that talk about making money seem to get a loyal following of sorts. I think it would be too boring to just talk about one thing.

One new blog that I follow is called Alpha Trends where Brian Shannon has youtube videos discussing the technical aspects of the market. I think he is dead on accurate with his observations. I have actually learned a lot from his videos. Because I like his site so much, I click on as many ads as possible to show my appreciation. He has helped sharpen my own critical thinking about the markets movements with his technical analysis. I also like to use stockcharts.com to make my own technical analysis of my own personal stock trades.

I just finished watching 3 very entertaining movies from blockbuster: Ocean’s Thirteen, Harry Potter and the Order of the Phoenix, and Evan Almighty. I liked Ocean’s Eleven the best of the three Oceans movies. I have seen every Harry Potter movie so far and it is still fun to watch. An interesting part is watching the same actors actually grow up in from movie to movie. Now Evan Almighty was really funny to me. I think it was funnier than the Jim Carrey version. I am looking forward to the new movie Get Smart with Steve Carell and think his delivery is really good with the slapstick humor.

OK, the markets were just down from the beginning and ended up even down farther by the end of the day. I would normally guess that the market would have a bounce at tomorrow’s opening because it does seem to be oversold. The only thing that stands out is that all the moving average numbers are pointing down even more dramatically. Both Bush and Bernanke did their stimulus announcement that did give the market a temporary push early on but that evaporated amidst all the stock announcements of layoffs, lower earning forecasts, more big bank losses, and of course the recession that seems to be affecting more and more people on a direct basis.