I couldn't believe my eyes this morning when I saw this article: Buying Opportunities Are Certain to Return in the Wall Street Journal.

So much can be said in so few words. I hadn't even realized I'd missed a buying opportunity! Ah, but there is hope. The title hints there will be other buying opportunities. It practically begged me to give it a read to find out when and where.

It turns out it's an article about the author's Common Sense market timing strategy. In a nutshell, his system says that market declines of 10% are buying opportunities and that rises of 22% are sell indicators. Those aren't hard and fast trigger points. He says if you want to trade more actively you can set the trigger points closer together, say at 8% and 20%. Or if you don't want that much trading activity, just set them further apart.

The Common Sense timing strategy is intended to take advantage of market volatility. It quantifies the "buy on the dips and sell on the spikes" strategy. That's all fine and well in theory, but I have to ask how one goes about putting it into practice?

What if, for instance, the market drops 10%, triggering a buy, and then drops another 10%? I suppose the right answer for that was to have held back and only invested 50% of my available funds on the first pull back.

Ah, but what if that second pull back never materializes? What then? Haven't I just half-missed that buying opportunity? If the market rises 20%, my gains on the sale will be only half what they might have been had invested fully.

If the market falls another 10%, then I can go "all in". Oh, but what if it drops yet another 10%? And, say... How was the first 10% drop a buying opportunity? Wasn't the second 10% drop the real buying opportunity?

What if there is a third 10% drop? Then what? What's the Common Sense answer to that?

The same common sense logic holds on the sell side. The problem here is you have no way to know whether a buy or sell trigger will be followed up by yet another buy or sell trigger. Not knowing forces you to hedge. Hedging, in the long run, will result in your sitting on the sidelines more than you should.

Common sense tells me the Common Sense market timing strategy needs a little more work.