After a long and rough bear market, it’s finally time to dust off bull market strategies.
The recent bear market began in 2022 and continued for most of this year. Stocks and bonds got pounded. Cryptocurrency took a nosedive, and every asset class saw negative returns. I remember thinking a year ago it would be a relief to turn the page on 2022 and start a fresh new year.
Nope! Market conditions did not change. Interest rates continued to rise and the hawkish Federal Reserve policy left many wondering if they would ever see stocks go up again. Of course, it is irrational to think that way but bear markets mess with our heads.
The constant volatility in a bear market is exhausting. It’s hard to find a winning trade, which leaves us playing it defensively and cautiously. Strict risk management is the only way to survive.
By late summer, the markets began digging out of that bearish hole and pushing through to a new bull market, which we flagged as starting October 1.
Pull out these bull market strategies
If you haven’t adjusted your trading approach, it’s time to pull out your bull market strategies. (If you don’t, it’ll be like trying to hit home runs on a hockey rink – ain’t gonna happen.)
You can be a little more aggressive, keep fewer puts working as insurance (but still keep some!), pick stocks rather than markets, and more easily accept losses now that we’re in a more forgiving market. The great thing about a bull market is you have many more chances of finding winning trades.
And just as important, you can clearly see markets rising from the bottom left to the upper right. With so much of our trading success riding on our mental state, you will feel more confident and much less anxious. That alone is a welcome change!
Cheers to the bull market, and cheers to your success as you continue to build your wealth.
