The overall market sentiment is mixed as new virus cases continue rising throughout the world, but most economic indicators came out better than analysts expected. Let’s look at the main market movements.
Be ready for the next market fall
Information is not investment advice
All of us have the fear to loose money. And, when the market crash happens, most of us keep it to ourselves. However, it’s not the best approach as we just sit and loose the potential profit we would have, if we were a little bit braver. So, let’s learn what every trader should do, when the market falls again.
Yes, it’s hard to leave emotions aside, but it’s so important not to panic in times of market crashes. For example, in 150 years the S&P 500 fell by 30% or more 15 times, or about once a decade on average. And what does always happen next? It recovers again and again. Sometimes it takes months, less often – years. It’s not a good idea to park your money in the stock market in these moments, but if you already have them, it will be better to hung on as stocks will rebound anyway. While many investors panic and sell all their stocks settling for low prices and possibly even significant losses.
Make a wish list
The most famous investor Warren Buffet said: “We [he and partner Charlie Munger] simply attempt to be fearful when others are greedy and to be greedy only when others are fearful”. Make now a wish list of stocks you’ve always wanted. So, the next time, when the market crash happens, you’ll enjoy buying all of them at very low prices. And then the market bounces back, prices will surge and you’ll gain.
Make an emergency fund
This extra money will give you an opportunity to buy assets at good prices from your above wish list. Moreover, you won’t depend from any unforeseen factors.
Diversify your portfolio
Don’t focus only on one currency, stock or any asset. Rebalance your portfolio and you’ll reduce your risks significantly. Finally, be ready to react, monitor the market, remember that even the bearish stock market is an opportunity!
The market sentiment switched to risk-off after the Fed’s Powell statement. The USD edged higher, while risker assets started falling after reaching quite high levels. Let’s have a closer look.
The overall market sentiment is mixed as investors await the Federal Reserve’s statement today at the evening.
The market sentiment is indeed risk-on today. Stocks, riskier currencies and gold are rising amid the waning US dollar.
The US NFP will be published on August 7 at 15:30 MT time.
The RBA will make a rate statement on August 4 at 7:30 MT time.