A sense of panic has taken hold of the market this week.
This past Monday, we saw algorithms drive the market lower; most of the downdraft was due to computers and deleveraging. That's why the move felt so aggressive and so quick.
Tuesday followed with the human trader reaction, as more fear creeped in around the edges. The likelihood of a major coronavirus outbreak in the United States is increasing, and as such, related panic selling will not cease anytime soon.
The only question now is how bad the disruption will be, but one thing I can assure you of is that panic selling in moments like this has proven time and again to be the wrong strategy.
You have to remember how the game is played, no matter the severity of the event impacting markets, and that has been and always will be buy low and sell high.
Everyone will debate on when to get in, but it's nearly impossible to time it perfectly. Instead, you should think about how to get in.
About the Author
Keith Fitz-Gerald has been the Chief Investment Strategist for the Money Morning team since 2007. He's a seasoned market analyst with decades of experience, and a highly accurate track record. Keith regularly travels the world in search of investment opportunities others don't yet see or understand. In addition to heading The Money Map Report, Keith runs High Velocity Profits, which aims to get in, target gains, and get out clean, and he's also the founding editor of Straight Line Profits, a service devoted to revealing the "dark side" of Wall Street... In his weekly Total Wealth, Keith has broken down his 30-plus years of success into three parts: Trends, Risk Assessment, and Tactics – meaning the exact techniques for making money. Sign up is free at totalwealthresearch.com.