A recent market sell off has everyone asking, “where do we go next?”
A bull will tell you we are going higher.
A bear will tell you we are going lower.
A true trader looking out for your best interest will tell you that they don’t know.
I don’t know where we go next.
What I do know is that the best opportunity to make game changing profits can only come from a move lower first.
In My Favorite Trading Book Ever, the featured trader makes his fortune from major market sell offs.
The key is to avoid what you think is a cheap buy and get a ridiculous buy.
You can only get a ridiculous, once a decade, buy when emotion takes hold and stocks are sold off in a panic.
Let’s look at Caterpillar for example.
It’s come down from 173 and is now trading at 115.
Many will say “it’s down so much, it has to go up.”
However, expanding the chart out a little shows that CAT was trading at 75 in 2016.
Sure you might catch a rally from 115 to 120 but imagine being patient and catching a move from 75 to 100!
You only get a few shots at game changing trades.
This Link will take you to my favorite trading book ever. It shows how fortunes are made and gives you the foundation you need to get started on your own quest.
So my big trade, it will happen if the market allows me to get in at a much better price.
If not, I still have this strategy.
It’s actually fun when you can root the market down because you are not in it but are willing to be at a better price.
Make sure to keep track of prices so you are prepared to act because when the time comes, there will only be a window for you to take advantage.