Basics Of Stock Market Trading: A New Era

Basics Of Stock Market Trading: Do or Die

March 2023

Market technicians, contrarians, the average Joe, and value investors will confound themselves by the new market system. Why do you ask? The answer is that a new era is upon us, where anything goes. Volume and the indicators market technicians have long relied upon will no longer provide an accurate outlook. The methods used seamlessly will no longer be as effective or perhaps ineffective. This applies to both fundamental and technical analysis.

A new era in stock market trading is upon us. As previously stated, what once was, will no longer be, and what is not will be. One must become a modified contrarian or market technician to navigate these swings. The key lies in identifying the extremes. For instance, a contrarian can no longer rely on the masses jumping in as a signal to jump out. Instead, one must analyze the speed at which they are jumping in, the number of individuals jumping in compared to the volume that was dormant just a few months prior, and their staying power, among other factors.”

The Basics of Stock Market: Key Concepts

Instead of selling, one could utilize this data more effectively. For instance, if the masses are jumping in after sitting out for an extended period, it would be fair to assume that they have amassed a significant amount of capital while waiting on the sidelines. It would also be reasonable to think that they are furious at having missed out on so much of the rally and believe that they are entitled to recover all of their lost profits in record time.

Given this scenario, the new contrarian would wait for a pullback before loading up and riding the wave to greater heights. The sentiment must reach a boiling point; everyone must be foaming at the mouth before the market puts in a long-term top.

Based on our analysis of current market trends and the psychology of market participants, it is becoming increasingly apparent that the markets may soon test the lows witnessed back in 2022. There is even the possibility of at least one index trading to new lows. In such a scenario, it would be prudent to exercise caution and remain primarily in cash while waiting for a more opportune moment to open long positions.

While jumping into the market during a downturn may be tempting, the current situation requires a more calculated approach. Considering the bigger picture and the potential risks associated with the market’s volatile nature is essential. By staying patient and strategically waiting for the right moment, investors can position themselves to take advantage of the market’s eventual upswing while minimizing potential losses.

Basics Of Stock Market Analysis. Never Trust The Fed

The Federal Reserve pulled a Houdini act with its relentless quantitative easing program, particularly during its psychotic helicopter money phase during the COVID crisis. To make matters worse, jackass Powell even had the audacity to declare that a bit of inflation was good. Now that his wish has come true, he wants to battle the monster he created. To label him as an idiot would be too kind. Needless to say, he is going to push the pedal to the metal, and it remains to be seen how much in interest rate increases this market can tolerate before collapsing.

In 2020, after a brief crash, the markets rallied and propelled the Dow and SPX to new highs. Feeling confident about the state of things, the masses threw caution to the wind and went all in, only to suffer significant losses and depleted bank accounts. Currently, the markets are establishing lower highs, and we suspect they are biding their time before the next leg takes hold. There is a decent chance that the lows of 2022 could be surpassed before the markets put in a multi-month bottom.

Basics Of Stock Market 101: Never Follow the Crowd

As the Chairman of the Federal Reserve, Jerome Powell’s job is to maintain economic stability and balance in the United States. However, his recent actions have made it clear that he is far from competent in this role. After the COVID-19 crisis hit and caused a market crash, Powell went all in with the Fed’s quantitative easing program, essentially flooding the system with money. This led to a boom phase that saw the Dow and S&P 500 reach new highs.

Fast forward to the present day, and Powell is now backtracking on his previous statements about inflation. He is now trying to destroy inflation after creating it, potentially leading to a recession. Companies continue to fire people due to the inflation that Powell brought about, and it’s clear he has no idea what he’s doing.

Powell: The Jackass that Never stops giving

Powell’s actions are a textbook example of why you should never let someone with no experience run the Fed. His complete lack of understanding of basic economic principles is astounding. He seems to have no idea how inflation works or how it impacts the economy, and his erratic behaviour is making things worse for everyone.

The fact that Powell is still in his position, although his incompetence, is a damning indictment of the entire political system. He has no idea what he’s doing, yet he’s still in charge of the most important financial institution in the world. It’s time for him to step down and make way for someone who actually knows what they’re doing.

Jerome Powell is a jackass for pushing so much money into the system after the COVID crash and then trying to destroy inflation after creating it. His actions are causing companies to fire people and could potentially lead to a recession. It’s time for him to step down and make way for someone who actually knows what they’re doing.

Research

Here are Five research references to support the content of the article:

“The Fed’s Inflation Target: What It Is and Why It Matters.” Federal Reserve Bank of New York, 2021, https://www.newyorkfed.org/aboutthefed/fedpoint/fed49.html.
“How the Pandemic Has Affected the U.S. Economy.” Investopedia, 2022, https://www.investopedia.com/how-the-pandemic-has-affected-the-u-s-economy-5084296.
Kahneman, Daniel. Thinking, Fast and Slow. Farrar, Straus and Giroux, 2011.
Fisher, Kenneth L., and Meir Statman. “The Contrarian Investment Strategy.” The Journal of Portfolio Management, vol. 22, no. 4, 1996, pp. 23–32.
Dreman, David N. Contrarian Investment Strategies: The Next Generation. Simon & Schuster, 1998.