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Take Advantage Of The Stock Market

I’ve been trading in the stock market for years now. Over those years I’ve learned to take advantage of opportunities when they’re presented to me. One of the biggest opportunities to be offered is when the stock market drops quite a few percentage points in one day or over a period of a week.
Yesterday’s decline was one of those days to take advantage of, especially in the basic material sector. The sector has moved up majorly over the last two to three months. In some cases like Freeport McMoran (NYSE:FCX) and Allegheny Technologies (NYSE:ATI), they’re up 83% and 130% since their March lows. So when days like yesterday happen and most investor and traders are taking profits, you need to be ready to jump in to buy.
Wednesday was clearly a profit-taking day. Of course the media was stating that it was because of the bad ADP Employment change report that came out, I beg to differ. Employment reports are always lousy near the end of a recession and during the turn-around period of the economy.
So late yesterday afternoon I took advantage of some good buying opportunities. The first trade I made was to buy Agnico Eagle Mines (NYSE:AEM). After it was up to $64 in the last week, it took a dive yesterday to the low $58 range, where I decided to pick up some shares. At the time of writing this post, It has moved to $61.25. A gain of over 5% overnight.
This is why you need to do research on not just the individual stocks, but also the market as a whole. I’ve been talking about the DOW going back down to the mid 7000 range and it seems that I may be wrong. Then again, it could still be coming, but the mood of the markets is more positive than negative. You can’t fight the markets, you need to ride out the current of the them to take advantage of days like yesterday. No one sector sells off like that in one day without having other investors jumping right in on the great buying opportunity.

Happy Trading.

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