Friday, February 10, 2012

Weekly Wrap

After posting marginal gains throughout this past week, the S&P 500 Index gave back those gains and a little more on Friday, leading to the index's first weekly loss of the year, closing out at 1343.

What do I make of Friday's pullback? One day does not a market make, this rally's alive and kicking.

If you've been an individual investor and daily stock market watcher like I have for years, you come to gain a certain feel for things, and a confidence in your abilities. It's nothing tangible or quantifiable mind you, and it can't rationally be explained to someone who hasn't walked in your shoes. It's what I previously referred to as "being one with the markets". Other people may refer to it as psychosis.

But, the way I see it, the main reason why the stock markets ended the week in the red is because investors having been expecting bad news for months, and now that nothing has materialized, they don't know what to do next. They're uncertain, like deer stuck in front of the headlights of a car, and can't decide which way to move. Given that herd mentality uncertainty, and being that it's the end of the week, the wise move is for them to lock up their gains, get out of the market, and see what happens next week. It has nothing to do with a loss of faith in stocks, just fear of the unexpected.

The S&P 500 index will continue to move ahead, and it will surpass 1400 soon enough. But, it's up you to decide whether you should stay, or whether you should go. Mull over those two choices.

As I've proven over the years, it doesn't take a genius to become a successful individual investor. All it takes is the ability free one's self from the matrix known as Wall Street, to open our minds, to avoid the herd mentality, and to think independently.

Of course, no one will believe it's that simple. So, I've called in a few of my simple-minded friends from the past to speak on behalf of my contrarian abilities, and to share their own opinions about current market conditions. Enjoy your weekend!

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