The Dow's recent surge to new all time highs was not confirmed by the Transportations, which missed it's mark this month.
This means: buy the dip or simply hold. Since we are still in a secular bull market, it's best to invest lump sums at once. If you can't handle the fear that a bear market may be just around the corner (after all, isn't it always?), then use dollar cost averaging to quel the anxiety so you can sleep at night even if the market tanks for some reason.
New money strategy: For me, I won't be thinking about dollar cost averaging just yet. I'm saving this for when the market is in free-fall. Dollar cost averaging is fantastic in bear markets because it lets you capture varying lower price points with money you've already taken out of the same market at higher price points. The bonus is that perfect timing isn't necessary, just a generally good reading of the market is all that's needed to make this strategy work very well. Hopefully I'll be able to put this idea to the test sometime in the next year or two.
The point: keep investing until a bear market is signaled. At that point, take profits and deploy them as the bear market begins to mature. Use dollar cost averaging as a strategy to keep you sane.
Happy investing.
