My Attempt in Timing the Market

Three year chart of the PSEi:
PSE1

A-     New all time high for the PSE index due to foreign buying.

B-      Technical correction

C-      Earnings season

D-     Greece debt crisis bail out

E-      Debt ceiling debate

F-      Greece exit fears

G-     Aversion of fiscal cliff

 

A close-up view on the events between D and E (between June 1, 2011 to November 1, 2011):

PSE2

A – Greece debt crisis resolution

 

B – Downgrade of US credit rating by S&P

 

C – Debt ceiling debate

 

A look on where we are now:

PSE3

A – Fiscal Cliff fears

B – Aversion of fiscal cliff

 

Two months from now there will again be a debate regarding the debt ceiling. Is it reasonable to speculate that the price action will be the same as that of July 1, 2011 to October 3, 2011?

My take is buying stocks that are cheap relative to their 2012 projected earnings, recession proof, and generates attractive dividend yield and set aside cash should there be a correction similar to what happened in 2011.

 

 

Disclaimer: Not an expert and nothing I say should be taken as a recommendation to BUY or SELL.

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