Best Guess
1997 was an excellent trading year, even given the October dumping. 1998 looks to be even better. I would, however, caution that index-based Mutual Funds will probably take a beating, as well as many growth and aggressive funds. Financials, Household/Personal Care products, and tech mergers/takeovers appear to be the dominant sectors for the first quarter. There is also some great opportunity in the asian market for oversold stocks. European markets look to follow asia's problems, for the same reasons, only to less of an extent. The DJIA and S&P look to be exhausting themselves, with even the Utilities and Transportation indexes leveling. Small Caps may make a slight comeback in the first quarter due to opportunities for largest growth, but I don't see it being sustained due to the takeover effects.
I don't have a call on the January effect yet, but if the market continues as expected, I think everyone will b glad that february is the shortest month. My advice is to reassess your risk position. Take profit where you can and cut your losses quickly. This will be no market to be slow to react in. Remember the basic rule: If its going down, then its going down. Period. Wait for strong recovery signals to reenter unless you daytrade precisely and attentively. End-of-day traders should do fine if you set protective stops at no more than 10% below your entry.
I don't believe in luck or timing or that there are any secret methods or indicators. I believe that if you work diligently at this, use what works for you, stay aware of indicator drift, follow some sensible guidelines, and pay attention, this year can be as profitable as any other. For any new readers of the thread, I will repost some basic criteria for evaluating stock charts and perhaps Jenna will do the same for Fundamentals. Maybe AT, DollrBill, Lou , Ed, Joe and Toothdock will contribute in kind.
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