Turnaround as Expected!
Even though Trump assured that the US-Iran agreement would be reached over the weekend during after-hours, any rebound thereafter should be viewed as an opportunity to exit positions. In the short term, it's better to avoid the correction. There's no rush; wait until the adjustment is over before looking for a new entry point.
The most stable dip-buying direction I've been talking about with everyone recently is memory chips! Even yesterday, when losses were widespread, only memory chips managed not to trap investors.
However, given the pressure on the index to adjust, memory chips are unlikely to remain unaffected on their own. So in the near term, it’s also reasonable to consider selling memory chip stocks during this rebound to lock in gains.
Once the index bottoms out, memory chips may still be the best sector to catch the dip—think of names like MU and SNDK. The main thing now is to be patient and wait for the right pullback before taking action.
Some previously strong stocks at high levels are also showing signs of catching up on declines, such as IBM, SNOW, and DELL. Once these stocks finish their correction, there should be another chance to rebound.
But in the short term, a meaningful rebound is likely only after they near their 10-day moving averages. Recently, whether high or low, almost everything is getting sold across the board, so there's no particularly good opportunity.
So for a conservative strategy, I still suggest staying on the sidelines. If you really want to buy the dip, focus on the memory chip sector as much as possible.
Even before SpaceX goes public, funds already need to rebalance. If this correction is mainly due to SpaceX’s listing, the downward space should be quite limited. If that's the case, then the adjustment shouldn't be too severe.
There's no need to panic in the short-term. Although the index is under pressure, the odds of an aggressive sell-off are very low. Most likely, it will just be a choppy adjustment.
The pullback in strong stocks will be more intense intraday, and there’s no way around that—after all, they had big gains previously. Gains and losses always come hand in hand.
So the most prudent approach is just waiting—for the next key date. June 12 could be that next milestone!
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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