You know things are askew when good news becomes bad news. Following a two day Fed meeting, Fed Chairman, Ben Bernanke, delivered what should have been received as good news on improving economic conditions; however, yesterday’s market rout is a clear indication that market participants (especially the bigger players) have become addicted to the Feds regular “easy money” drug infusion. The negative price action is certainly made worse by the fact that many of the larger traders and investors are now on vacation — so market volatility is here to stay for awhile.
The best that one can do now is be patient, watch for sales of favorite stocks and then hold your nose and pick-up a few good bargains when the prices look right. Personally, I like to watch to see if my favorite investments hold above major price points like the 50-Day Moving Average, and then purchase additional shares when situations appear to have stabilized.
Remember, quality stocks are always in demand; so, if a stock like (JNJ) or (KO) drops in price that is not a bad thing.
Disclosure: I own shares of JNJ & KO indirectly through Vanguard’s (VTI) ETF.
