I mentioned about 2 weeks ago to take profit. Well, stocks are now facing some resistances and may retrace a little. How big will the retracement be? My take is, very little. I don't see stocks falling > 10%. So my suggestion is to buy soon. It's just profit taking. after a rally that lasted from July to early October, markets are bound to pause for a breath. This is when doubters take profit and exit completely while believers like me take some profit, stay side lines and watch, and then enter again. The doubters who exited will eventually return to stocks next year and miss out another 10 - 20% upside.
Major economies are undergoing QE 2, the yield curve is still very flat, the latest 3rd quarter results season has been better than expected. It's still all-systems-go for the stock market until mid to end 2011. Watch this space.
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