Oh boy, that hurt! I mean, the market is down nearly 10% in just one month as we’ve gone from yearly highs to yearly lows in a flash.
Now, for many of you, your stomach is starting to churn; so I thought I’d look at how much worse it can get. Unfortunately, the news isn’t good there either. The Dow could drop another 1,000 points over time before it picks up any sort of long-term trend line. Ouch!
However, I’m always less concerned about the market than I am about individual stocks. And just as I was selling into the earlier year rally, I’m starting to load up again on the long side.
What am I buying? As usual, the stocks I know and love. Stocks where I think: if Greece craters are people going to stop buying Band-Aids?
Therefore, let’s take a look at Johnson & Johnson (JNJ), a stock I picked up on Friday.
I will remind you, by the way, that I am in no way trying to call a bottom on JNJ. In fact, I’m prepared to hold for as long as necessary to make a profit, and will buy MORE if it drops much lower. If it takes me a year or so to make a profit, then so be it. That said, I’m betting I’m back out of the stock within the next 60 days.
Along similar lines, I also bought ExxonMobil (XOM). Sure oil prices are down, but regardless of the economy or commodity prices, this warhorse is always a good buy when it drops 10% from a recent high.
Remember, though, that regardless of your investment or trading strategy, you have to be 100% comfortable with what you’re doing. I’m comfortable because I know companies like JNJ aren’t going away anytime soon. And I’m also comfortable buying a lot more if these stocks really drop. Trust me, I don’t have a steel stomach. I just have a plan.
Gary B. Smith joined FOX News Channel in 1999 and is currently a regular commentator on "Bulls & Bears," including his own segment called, "The Chartman."