# Since the correction is happening now, will May be okay?



## LPA (3 March 2007)

Just a question from a beginner.  Only started trading after the May drop of '06 so I am a bit skittish about that month 

But since most people seem to think that we are looking at a 5-10% correction right now, does that mean that May will be as bad as last year?  

Also, as an investor with only about 10k invested, should I be thinking about selling out and buying back in around June/July?  The broker costs seem to be substantial enough for me that I should just hold and ignore the markets for a month or two 

Thanks for any help, just trying to get my head around these psychological aspects of the market...


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## It's Snake Pliskin (3 March 2007)

*Re: So if the correction is happening now, does that mean that May will be okay?*



			
				LPA said:
			
		

> Just a question from a beginner.  Only started trading after the May drop of '06 so I am a bit skittish about that month
> 
> But since most people seem to think that we are looking at a 5-10% correction right now, does that mean that May will be as bad as last year?
> 
> ...




It may.....


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## brerwallabi (3 March 2007)

*Re: So if the correction is happening now, does that mean that May will be okay?*

There is an old adage sell in ...........


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## bean (3 March 2007)

May will be O/K if you have anything left by then. To invest in Gold and Silver


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## nizar (3 March 2007)

LPA said:
			
		

> Just a question from a beginner.  Only started trading after the May drop of '06 so I am a bit skittish about that month
> 
> But since most people seem to think that we are looking at a 5-10% correction right now, does that mean that May will be as bad as last year?
> 
> ...




Probably.
Last year May-August wasnt a short and sharp correction (different to Oct05 3 weeks then up and away again) rather it was kind of like a bear market for a few months.
Because of this, we didnt have out (what some to think to be traditional) Red October.


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## tech/a (3 March 2007)

There are months in which one should be careful in the Markets.

September 
May
December and 
July.

Others are

Janurary
Feburary
March
April
June
August
October
and 
November.


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## lesm (3 March 2007)

*Re: So if the correction is happening now, does that mean that May will be okay?*



			
				It's Snake Pliskin said:
			
		

> It may.....




...or it may not


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## Broadside (3 March 2007)

If there is a mini correction now I would think the market will be less vulnerable to a correction in May, yes, that is common sense....but there are no hard and fast rules except that the market rarely displays common sense.  I think it will recover fairly quickly but there could be a much bigger, uglier correction a few more months down the track.


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## Out Too Soon (3 March 2007)

If the correction isn't nasty enough now then May will probably be terrible, it's totally unnecasary of cause but because enough "experts" have convinced each other that we're due for a correction then it's happening, completely self perpetuating all we needed was a trigger- Shanghai.

10K is a good amount to start with & learn, that's what I did, if I started with 100k I'd be too scared of losing it.


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## MichaelD (3 March 2007)

Prediction of the markets is best left to analysts who get paid for their analysis, not by their trading.


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## mmmmining (3 March 2007)

Maybe Mr Market brings the correction forward by two months. Officially starts in March, and it might end in May. 

I believe Mr Market will be very tired to have quick two....


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## bean (3 March 2007)

I have daily data for Dow from 1895 - I have a program where Dow and NASDAQ have a range of +317 to -317. As of today both are -227 and falling rapidly. Monday has to be 'up'.


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## insider (3 March 2007)

tech/a said:
			
		

> There are months in which one should be careful in the Markets.
> 
> September
> May
> ...




Why are these months so bad?


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## numbercruncher (3 March 2007)

This whole year looks bad ......

The US is slipping into a recession led by its tumbling realestate market .....

A Trillion dollars of US mortgages are resetting to higher rates this year ...

Everyone has an itchy trigger finger on the sell button ......

Yanks might start bombing Tehran shooting oil past $100 .....

The yen carry trade may start to unwind ....

The world might stop consuming so much Chinese Junk leading to less demand for the stuff we dig out of the ground .....

Im sticking to my plan of day/week trading only holding nothing over a weekend, everything sold by Friday ! (win or lose).

Goodluck for 07'


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## nizar (3 March 2007)

insider said:
			
		

> Why are these months so bad?




LOL read the whole post.
His point of posting that cliche, and it is a popular one, is that markets are risking, investing is risky, ie. every month is risky!


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## CanOz (3 March 2007)

nizar said:
			
		

> LOL read the whole post.
> His point of posting that cliche, and it is a popular one, is that markets are risking, investing is risky, ie. every month is risky!




December, selling leading into the holidays
May, selling after the bull run after Christmas
End of June, tax loss selling
September, typically a bad month 

Am i close?


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## Sean K (3 March 2007)

Could be a wave C in May, heading to 5450ish.

MAYbe....


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## Judd (3 March 2007)

tech/a said:
			
		

> There are months in which one should be careful in the Markets.
> 
> September
> May
> ...




Knew I'd seem something similar before.  It is a paraphrase from Pudd'nhead Wilson's Calendar by Mark Twain for the Month of October.

http://etext.virginia.edu/railton/wilson/calendar.html

Apparently even Warren Buffett is quoting from the calendar (see February)


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## dhukka (3 March 2007)

LPA said:
			
		

> Just a question from a beginner.  Only started trading after the May drop of '06 so I am a bit skittish about that month
> 
> But since most people seem to think that we are looking at a 5-10% correction right now, does that mean that May will be as bad as last year?
> 
> ...




The fact that you need to ask this question demonstrates that you really shouldnt be putting your money in the stockmarket. Put it under your mattress your sure to lose less.


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## Buster (3 March 2007)

G'day NumberCruncher.. or is it Chicken Little, AKA Henny Penny..



			
				numbercruncher said:
			
		

> This whole year looks bad ......
> 
> The US is slipping into a recession led by its tumbling realestate market .....
> 
> ...



Hmmm.. You missed 'the Sky is Falling..'   

Although not too many have commented on the Ex Div & Record dates of most companies are all around this time also, and traditionally these dates tend to depress the stocks price.. coupled with the general tale of woe that is the 'correction' it probably looks worse than it actually is..

My portfolio always takes a bit of a hit around this time of year (as well as Oct/Nov) due to the dividend strippers etc.. I'm not particularly fussed at the minute.  I don't expect to much volitility around May due to the 'shake out' thats occuring at the moment.. I think it's people trying to avoid the 'bad' month of May by getting out early, and in doing so creating the same conditions, just earlier in the year..

Then again I could just be full of sh*t..  

Cheers,

Buster.


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## Buster (3 March 2007)

dhukka said:
			
		

> The fact that you need to ask this question demonstrates that you really shouldnt be putting your money in the stockmarket. Put it under your mattress your sure to lose less.



Awwww.. Unfair.     Thats not really helping anyone out, and he did say he started out with a small sum so that he wouldn't do too much damage..

Hell, some people blow that much on the so called expert trading system course and software and not a penny on a trade..   At least he's backing himself, maybe he will learn some valuable lessons, but even if it all goes to custard, nothing soul destroying..

Cheers,

Buster


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## numbercruncher (4 March 2007)

Buster said:
			
		

> G'day NumberCruncher.. or is it Chicken Little, AKA Henny Penny..
> 
> 
> 
> ...





G'day Perma Bull Buster,


Oh i wouldnt say that, im sure youre as good a financial pundit as say Greenspan or Soros ......   

It sure would be a boring world if everyone thought on a global scale hey   


May peace be with You.


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## LPA (4 March 2007)

dhukka said:
			
		

> The fact that you need to ask this question demonstrates that you really shouldnt be putting your money in the stockmarket. Put it under your mattress your sure to lose less.




Gee thanks, your arrogance is very becoming.  Don't worry about me - I'm substantially up for the one year I've been trading.  I have exit strategies and I only invest with money I can afford to lose anyway.  Seriously, just because I'm not a 'fundamental analyst' doesn't mean I'm an idiot - get over yourself.  I just wanted to start a discussion...

Thanks for those of you who tried to give some useful information though.


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## mmmmining (4 March 2007)

If you guys have a look at 2005 XJO chart when 5% correction between March and May happened, this year might be the similar one, and maybe a bit more serious. I guess, might be 5-10% correction. And then, the market will pick up again.


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## purple (4 March 2007)

LPA said:
			
		

> Gee thanks, your arrogance is very becoming.




"un - becoming"

LOL

sorry LPA, couldn't resist that. a bit bored sitting out the weeekend waiting for the action (or unaction) to start again on Monday...

anyhow, don't take notice of that fellow, must have had a massive loss
-->  

to answer your question, no way will May be OK. I think people tend to look to history and compare the crashes of old, but the market of today is much more liquid and it moves far faster with e-trading. Plus the ability of stop losses and all the stuff, things may barrel up and then crash again. 

the risk is never lessened, IMHO. if anything, the risk is more nowadays I suppose.


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## Out Too Soon (4 March 2007)

insider said:
			
		

> Why are these months so bad?




It was noticed quite a few years ago that those months were on average worse. Now because most traders are aware of the fact it becomes another self perpetuating fact. Reason or not, everyone gets jittery leading up to may etc.
I'm guilty too, I have stuck above my screen "sell in may (late april) go away".


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## LPA (5 March 2007)

purple said:
			
		

> "un - becoming"
> 
> LOL




Hehe, yes I did realise that - I was being sarcastic  Should of used the emoticons...anyway the fact that he doesn't know the difference between 'your' and 'you're' says a lot.  I hope he lost big-time  (now that was uncalled for!)

Anyway I've always been interested in the psychological aspects of the market.  I presume that because it can be so affected by psychology that the majority of holders are short/mid term traders?  long term traders just hold onto the good companies until they need to buy a house or something 

It will be interesting to see though, if we have a 10% correction before mid-May (plenty of time yet for that to occur) whether the psychology will kick in still or whether people will be a bit more sensible and realistic about things.

Either way, I've decided to just hold and not try and time things as I don't have the knowledge to do that successfully (plus the broker fees are significant enough to be taken into consideration) - maybe I'll pick up a few more after the carnage


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## Out Too Soon (5 March 2007)

down 4% all together so far. 5700, best advice now for those still holding like myself is just hold on, go do the mowing, take the dog for a walk, take a holiday. Just dont sell.


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## Mousie (5 March 2007)

Must admit it was more fun watching the huge "correction" (only?) last week and then the slight rebound later in the day rather than the gradual bleeding (of market caps) we saw today. Today kinda suffocates you slowly, and I think this was amply represented by the outstanding no. of posts last week and the no. of posts today. Any bargain hunters out again anytime soon?


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## Out Too Soon (6 March 2007)

Mousie said:
			
		

> Must admit it was more fun watching the huge "correction" (only?) last week and then the slight rebound later in the day rather than the gradual bleeding (of market caps) we saw today. Today kinda suffocates you slowly, and I think this was amply represented by the outstanding no. of posts last week and the no. of posts today. Any bargain hunters out again anytime soon?




"Hold your fire! Wait until you see the whites of there eyes."


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## carmo (6 March 2007)

Where's all the super money going to go now??


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