As the bear market continues, you may find yourself losing patience. You’re in good company. Many traders will start losing money now, simply because they are tired of sitting on the sidelines. They want to be in the game for pete’s sake! I totally get it. However, you cannot will the markets to do what you want them to do and when.

The bear market continues into its seventh month

We’ve been in this bear market for the better part of seven months. Yes, that long! I realize that technically, a bear market is called once indices are down 20% from the top. That finally happened in May, but let’s be honest here: market action exhibited bearish qualities from the start of the year.

Not knowing the future is always tough for traders, and not knowing when this bear market will end is the ultimate frustration. A bell doesn’t ring when it’s over, and in fact, a bear market won’t end until the last trader standing waves the white flag and says, “I am finished.” At that point, the market tide will start to turn.

Emotions are rising but play it smart

Our biggest challenge right now is psychological. Everyone is ready for a bullish trend to take over, and until it does, emotions will rise as the frustration mounts. Don’t be tempted to listen to anyone who issues an end date on this bear market. They don’t know any more than you do.

Instead, let’s look at the facts. The Fed remains vigilant about fighting inflation. Volatility is low and that means two things: option prices are cheap for both puts and calls, and the market is not anticipating big moves.

What to do now? Continue using the bear market playbook. Hold lots of cash, protect your portfolio with index puts, play it small and tight, sell calls against your stocks, and remove stocks that are not working for you. In addition, start making a wish list of names you want in your portfolio. As this bear market plays out, even the best names are likely to take a hit (and become affordable).

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