Boy, I go away for a week, the market rallies. I return, it drops. I know, it’s silly, but this is sometimes exactly how traders think.
Yet, while I don’t think I’m the cause of the market decline, the fact is it hasn’t done a darn thing since the recent breakout earlier this month. On the other hand, it hasn’t quite dropped enough to present any big buying opportunities.
That leaves us clearly on the sidelines waiting for either a bigger dip to buy, or a big rally to sell.
When looking to buy stocks on dips, it’s always a good idea to buy at a point you think a bounce is likely. That place is often at previous lows and that strategy worked well Friday morning with Sirius (NASDAQ: SIRI). (I wasn’t greedy, by the way, and sold into the surprising rally later that morning.)
There’s a fair amount of foreign stocks I like, and I trade them using their American version in the form of an ADR. The only problem is they gap up and down a bit, so if you trade these, always use limit orders.
I did this with Novartis (NVS) and am hoping for a gap up on Monday morning.
That’s it from the tundra they call DC, where snow – snow? – is in the forecast again. Maybe just go long Toro and be done with it?
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."