No doubt, the market selling as of late has been brutal. As noted by BofA:
"More than 90% of stocks in the S&P 500 declined today. It's the 5th time in the past 7 days. Since 1928, there have been exactly 0 precedents. This is the most overwhelming display of selling in history."
This kind of extreme bearishness is often a great contrarian indicator, suggesting a reflexive rally is coming. Today's strong bouncing is likely only the beginning of this "dead cat bounce" and I believe we may see more highs in the days ahead. Of course the market will never make anyone's life easy, especially lately we have seen so many fake rallies that only lasted one or two days. That's the reason I suggested to my DW Family today to take some gains off the table while still keeping some on the table. At the abyss of selling last week that pushed SPY down towards 366ish, I was pounding the table even to my chat groups to buy. No surprises that I immediately got feedback arguing that this was not the time to buy as the market trend was too bearish based on all kinds of economic and financial conditions. As a contrarian, this negative feedback is even more convincing evidence to me that it was a great time to buy. That's why I was more aggressively buying in the last two days of last week. Glad I did so. 😇😂
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