When Should I Sell My Stocks?

Just when the outlook is so positive with the recovery, we have a day like November 26, where market seems to be sliding into oblivion.

The Dow, NASDAQ, and S&P all suffered. Investors are thinking, why can’t I see any of this coming? Well, you’re not alone, because none of the top investment companies predicted the Black Friday event.  And they likely won’t see the signals that will predict the next stock market crash.

Top Crash Signals Listed Below

There are 26 top market crash signals listed below, and in general, the more you find, the greater the likelihood. You should become more sensitive to them.  On Black Friday, we witnessed the collective fear and government reaction to potential viral spread.  Obviously that’s a factor, and it will grow this coming week.

Not mentioned in crash scenarios is the effect of Facebook and the media. They’re much better at delivering bad news and hyping it, so they might be the ultimate accelerant of a market crash.

But these dips and rises tell us a lot about what investors like and don’t like. Those stocks that sunk today seem to be the opposite of what really turns investors on. You should taking note of them. Are up on the stock market crash signals? You must be an expert on that, so you can get out of the stock market before the downturn.

Remember, that many experts feel this is the biggest stock market bubble in history and that it’s overdue for a crash, and that if not for stimulus spending, it would have crashed naturally. It’s entirely artificial at this point.

Despite an optimistic outlook for the next year, the year 2023 is a scary one and the likelihood of your portfolio crashing is greater than it will go up marginally. So the reality is it’s risky to be holding stocks. That is unless you hedge really smartly and only choose the best stocks.

Economies change, go through transitions and fall suddenly into recessions. Recessions have always been sudden right after a long bull market.  The market hits maximum euphoria where investors buy anything to make another dollar.  We might be at that point right now where you need to sell your stocks. You could buy real estate however it will take a short dip. Real estate never loses its value especially when governments stop housing development.

No one wants to invest in poor performing stocks nor in poor performing companies in industries that have seen better days. But sell signals for these stocks appear for those who want to see them, or have alerts set up in their stock trading accounts. We’ll talk about those sell signals now. Knowing when to sell could be the most important knowledge an investor possesses. The tools are available.

What is a Sell Signal?

According to Investopedia:

A sell signal is a condition or measurable level at which an investor is alerted to sell a specified investment. Sell signals can be generated through a variety of methods, such as a pre-determined percentage decline in the asset’s value, a technical indicator, fundamental change in the asset, or a trailing stop-loss. Stock sell signals systems are used by all types of investors and traders, from day traders to long-term investors.

24 Key Stock Sell Signals:

  1. key share holders are selling the stock
  2. price is trending down
  3. price hits your target you set when you bought it
  4. moving average is falling
  5. price volatility is increasing
  6. price/earnings ratios are falling and are well below other stocks
  7. technology changes make their products look redundant or unpopular
  8. cash flow is ailing
  9. RSI indicator shows weakness
  10. interest in the sector is waning; sector rotation happening
  11. strong competitors are entering their market (e.g., Tesla)
  12. loss of key customers or sales channels
  13. your profit level has exceeded your expectations (e.g., 25%)
  14. company changes policy such as paying out dividends
  15. price to book ratio falls below sector averages
  16. poor debt load management with rising interest rates
  17. loss of key employees
  18. change in management personnel
  19. better, stronger stocks have come to your attention
  20. government regulations announced (such as regulation of crypto, home building, or carbon emissions)
  21. company is planning to issue more stock
  22. stock market experts are advising to sell the stock
  23. the real estate market is offering higher returns — buy property
  24. key international trading nations are experiencing negative turmoil (e.g., China’s recent real estate finance)

Of course, by the time your system picks up enough of these key stock sell signals, it might be too late to prevent your loss. You’ll need to assess short term movement signals too. And on the other side, you’ll need to know the buy signals and buy recommendations of those stocks that are beginning to perform well.

The tech stocks in particular have enjoyed a good run in the last 18 months. But investors are selling them and moving onto stocks that will benefit from the economic recovery.

The pandemic shutdown worked well for many of them since money that would have gone to other industries (travel, restaurants, clothing, malls, transportation etc.) instead was pushed into technology companies. The tech companies didn’t do anything particularly ground breaking or innovative to deserve.

Google, Facebook, Amazon, Netflix, and Apple didn’t do much to spur great new products. They just harvested demand pouring in from “stuck consumers.”

Well, now as enter June 2021, consumers are back outside re-engaging in behaviors and product choices they had in 2019. Investors are playing down this transition in consumer and business behavior. But the summer of 2021 is unfolding fast in some US states and in Europe. The vaccines are kicking in and once the immunity levels are proven, full reopening will progress and consumers will regain their confidence.

We still have a lot of stimulus money being spent and investors realize this money is going into products, including new homes and resale houses in the housing market. The trend away from tech and into value stocks is ongoing. Of course, many self-directed investors and their advisors can’t find reason to let go of their losing stocks. They believe in the media’s and governments unrealistic pushing of eco-responsible companies and ideologies, when those industries have a flimsy backing.

Tesla is the perfect example of an overvalued tech stock that’s benefitted from ridiculous speculative investment. Review Tesla’s stock price and forecast. That was a one time thing that won’t be repeated. So there you have a strong sell signal — a huge one time surge in speculative interest during an unusual economic phase.

To stay ahead of the crowd, you can utilize a variety of predictive tools available and you can learn more about artificial intelligence stock forecasting services. The technical indicators are improving but nothing is an Oracle. The factors driving the stock market are unique, but this transition from growth stocks to value stocks has happened before. The patterns are there. You just need to pick the right stocks or ETFs.

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