My Stance on the Current Market: 10OCT2010

So, I’ve been watching the market very closely for some time now and educating myself on economic policy and its effects on the market.  I’ve also been learning the ropes for certain indicators to watch for while at the same time learning that sentiment and government intervention don’t always let the markets play out as they should.  With all of that said, I just wanted to write a quick piece on how I am setting up my personal finances and what I expect to see play out in the near future.

I believe that the precious metals market is due for a pullback in the near term and will present a great buying opportunity.  I consistently buy regardless of price but during the coming pullback my plan is to go ahead and load up on extra.  My belief of there being a pullback is based on the metals being in a short-term overbought situation as shown by RSI, weakening volume, and the initial excitement of the latest run waning.   I also think we are about to witness a similar pullback in the stock market for the same reasons mentioned above.  This will provide an opportunity to buy mining stocks that have also made a run over the last six weeks.  Also, the dollar is way down over the last six weeks and I believe it will make a slight correction to the upside while everything corrects downward.  I think an important lesson here is to remain calm and pay attention the the activities not only in the market but in the political scene as well.  Don’t try to time the markets, but certainly be prepared to take advantage when the opportunity presents itself.

Although I am ready to execute on what I see to be a great buying opportunity I still make consistent purchases because my overall prediction for this sector of the market is to continue North.

I will be paying close attention to more talk by the Fed for more quantitative easing as well as the upcoming elections in November.

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