Since last Monday the market has made a nice little rebound but it will take about 6 months of this before we are out of the woods.

The market has formed a hammer candle stick which is a positive sign. This is usually seen as a reversal pattern. How long the uptrend will last is unknown at this point since the economy as a whole is still very negative.

Even with that said there are many beaten down stocks that have huge potential. I particularly like the solar industry and for a long term hold the oil industry.

Here’s a chart for the action this past week:

While the markets just experienced the worst one day drop ever in history and many people lost the shirts of their back, this also represents an opportunity of a life time seen only ever few decades.

If you have money on the sidelines this is the time to step in and start building positions in quality companies. I emphasize the word quality because these are the companies will come back. Athough there are many cheap companies out there right now, cheap doesn’t always mean buy.

If you thought Washington Mutual was cheap at $2 you’d be broke today.

I believe oil and energy sector will come back the fastest. Certain companies in the retail sector will also come back but may take longer. Start looking now while things are on sale.