Goldilocks Market

Those in the know have been calling the US economy a Goldilocks economy for a while now. The economy was growing to little or too much, but just right. But after last week's employment number shocks, and the sustained period of volatility, I'm reminded of the classic game, Chutes and Ladders.

Just like the game, we would normally expect to plod along slowly forward, knowing there will be a lucky break with a ladder upward, and also knowing that there will be unlucky breaks with chutes downward. However, the market just decided, forget the slow pace, lets just have Chutes and Ladders every day.

And that's where we are today.

Every turn is another economic report: negative means a quick slide down and positive means a quick upward climb.

But how can we get back to the normal market days, when the economy consistently moved forward, albeit slower? It may take some time. We need all the economic indicators to point in one direction. We need Federal monetary policy to be predictable. We need the dollar's strength back.

Recently, I have dropped my bullish attitude for the market. While there are plenty of cheap opportunities out there, the general direction is going to be flat. Day to day, we're going to seesaw between red and green.

What can you do to profit? If you could be a day-trader, you could make a lot. But also, if you are a long-term investor, buying the discounted stocks now and waiting for the market to correct yourself could also make you money. What's bad right now is betting on medium-term trades (under 6 months).