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When Will This Bull Market End? Look To This Simple Strategy For An Answer
While prices are rising, investors need to maximize their gains. When prices turn down, investors need to minimize their losses.
The problem many investors face is worrying about a bear market during the bull market. Worries can be stopped by switching to cash, but then investors miss gains, and failing to take advantage of market gains destroys potential wealth.
We do believe that it is OK to worry about the state of the market. However, we don't believe it is OK to act on those worries without a plan. Investment actions should be based on plans that react to the market, and the 10-month moving average (MA) is the simplest way we know to do this.
Before we explain why, this chart of the SPDR S&P 500 ETF (NYSE: SPY) can help highlight the importance of this indicator.
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