I generally think that a -10% correction is a great drawdown point to start entering. But, at the same time, some individual stocks have been totally crushed from Zoom to Palantir and Peloton and more. These big, pandemic, names have been cratering 30%, 40% and 50%. Just look around the market and you will see that it is a stock picker's bear market!
The three charts above showing the indexes that I am most interested in:
S&P 500 Nasdaq-100 Russell 2000
I don't show the Dow because it is just 30 companies. There are over 5,000 stocks in the market today and even more cryptocurrencies. I really don't want to compare just 30 companies no matter how large they are. I am not interested.
All that matters now to me is where the bottom will be found.
Small caps are -13% and they tend to be my favorite playing field. So I am looking deeply into that world.
But also the Nasdaq-100 is down 7% from its highs. Let's just I've set an alert for the Nasdaq-100 and the moment it hits -10%. I think that will be an interesting choice.
When we something that sticks out from the general trend it is usually a warning sign. Something feels different about these dips.
scheplick
⋅
@dc2007, Indeed, no one ever knows if the dip keeps deeping
EvanMedeiros
⋅
Nice post! Fire up the DCA algos, starting to finally see some opportunities for patient capital.
scheplick
⋅
@EvanMedeiros, I think you're right! I am bottom fishing a little but haven't found the perfect trade yet. But looking among all the individual names!
lauralea
⋅
I can not follow these charts clearly, but thx for update. I guess we just "draw" differently (o"
CBIchiban
⋅
Great dilemma to have: asking the question means that cash is available. I have started buying to DCA on the Cos where the highest convictions lie (e.g. DDOG). Understanding, though, that the road ahead is undoubtedly sinuous, long and hopefully rewarding. A temp short-term bottom may be near, but I find it hard to trust that the systematic dip-buying will still be the order of the day in months and years ahead.