Buy The Rumor, Sell The News?

You didn’t expect a big move in either direction today, did you?  The bears can’t get too bearish in case the government changes the rules.  The bulls couldn’t get too bullish in case the stimulus package isn’t all that.  So, we’re left with a boring day without big moves.  I made no moves today and I’m waiting to see a reaction to the stimulus package.  I still believe it’ll be a buy the rumor, sell the news event.  All I’m hearing today on CNBC is a lot of cheer leading and hoping the market goes higher.  I want it to go higher also but you have to invest based on what is happening, not what you wan to happen.

I’d say stay patient right now until we get more of an extreme which could come soon.

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3 Responses to “Buy The Rumor, Sell The News?”


  1. 1 Joe February 10, 2009 at 12:02 am

    Hey Karl I listen to your show every mourning and would like to thank you for all the good info you give. I am 32 yrs old and I know that the “buy and hold” approach is a thing of the past, but I know that I do have the time option on my side. Till now I have only invested in my 401 and a few individual stocks like (pep) and (wmt). I recently opened my fisrt Roth IRA and have not directed it anywhere as I am confused on market. The financial planner I was speaking to was advising me to invest in the market as a whole and sit it out 15 to 30 years whenever up. That in mind I have recently been looking at (SSO), (VUG), (IWM), and (IVW). these are all very similar except the growth fund for Russell 2000 one. I would like to know how you feel about this. Does this seem crazy or would I be better off looking toward etf’s in sectors like materiels or precious metals then waiting mid term?

  2. 2 michael February 10, 2009 at 7:31 am

    Karl,

    Keep up the good work your show is great.

    I wanted to ask about the “so goes january so goes the year” theory. I’ve heard it’s about 90% accurate but does that include up years? If so what is the accurancy for just down years?


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