Zacks highlights commentary from People and Picks Member «MightyMo».

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Goodbye Good Friend - the Bull Market Leaves

In my opinion the bull market is over and the bear market is beginning. This doesn't mean stock prices will collapse immediately.

Bear markets are a different type of beast. They have sideways actions, big bounces and bigger sells. The bear market of the 1970's lasted almost the entire decade. It was a great time for option premiums. The bear of 2000 to 2003 and 2007 to early 2009 were pretty severe with losses of more than 50%.

The chance of this bear market seeing such collapses is probably as great as any previous ones. Just remember that bear markets take months to unfold and normally collapse near the end. In-between there are lots of opportunities to make profits. There is no need to fear a bear market, but it is worthwhile implementing different strategies and remaining conscious of the fact that the bull market is probably ending.

My strategy, part of it, will be purchasing index puts on any bounce higher. The future  DiviMo and BearMo postings and commentary will relate to my strategy during the bear market period.  Meanwhile for my positions that have covered calls, I will be taking opportunities in any rise in stock values to sell calls in the money as I am sure that many of the covered calls once sold in the money, will eventually end up out of the money as stocks pull lower.

The bull market - Mar 2009 to  April 2011 - was fun, entertaining, profitable and educational. As stated in an earlier blog, this will be MightyMo's last blog....that is the plan at  least until there is a direction turn in the market or our strategy changes.

The most recent picks by «MightyMo» are:
A buy rating on Complete Production Services (CPX),
a buy rating on Ryder (R) and
a buy rating on The Talbots (TLB).

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COMPLETE PRODUC (CPX): Free Stock Analysis Report
 
RYDER SYS (R): Free Stock Analysis Report
 
TALBOTS INC (TLB): Free Stock Analysis Report
 
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