It is said the stock market trades 6 months in advance and that appears to be the case now.
The Dow Jones Industrial Average is up 704 points today to 24,242, more than halfway back from the 2020 low.
The recent move is further proof you cannot pick the bottom because the news hasn't been great, yet the market is recovering.
This is not to say it will be smooth sailing from here on out, but there is some confidence in the market.
Those who sold on the way down could now be buying back at higher prices than they sold, if they were waiting for the market to bottom.
Personally I didn't sell anything and made my monthly purchase like I do every month and also bought some more index funds.
So for me, I took this as an opportunity to dollar cost average and invest more, so when the market fully recovers I will have some handsome profits in my monthly purchase as well as the additional purchases I made all while my account value is restored to prior Covid-19 levels.
Doing this is not as easy as it seems, I held back from a few opportunities that would have paid off even more, but I was concerned about using my emergency cash position in case I needed it to buy toilet paper and hand sanitizer (just kidding).
I recommend having 3 to 6 months of monthly income in a money market fund and it turns out I will need some of it as my wife just returned from the emergency room for kidney stones and I know we will owe anywhere from $1,500 to $2,000 even with full medical insurance.
Take this to heart and build your 3-month to a 6-month cash position for emergencies or unexpected expenses, then start on your wealth-building journey.
To your wealth!