Although I anticipate that the bears will have a strong showing this year, I have learned to wait for the market to confirm my view. If the market starts to plunge, I will add to my inverse ETF positions, and also buy puts for the short term. Don’t forget Jesse Livermore’s astute observation: Only the market is right. Put another way, don’t think you are smarter than the market. Many billions of dollars have been lost over the years because investors and traders refuse to admit that the market has the final word.
As a long-term trader, I strive to be patient enough to wait for the right opportunity, and agile enough to pounce at the right time. If I’m late, I will not play catch-up but will be patient enough to wait for the next opportunity. Got that? Don’t chase if you missed an opportunity to make money. You will get another chance a day, week, or month later depending on market conditions.
My favorite book in 2015: Jesse Livermore — Boy Plunger by Tom Rubython. Highly Recommended.
I also recommend Prepare Now and Survive the Coming Bear Market by Mark Cook and myself. It appears as if a bear market has arrived, and our book will tell you what to expect.