Stock Market Trading
Market technicians, contrarians, the average Joe, value investors, etc., etc. are all going to be fooled with the new market system. Why do you ask? The new era is that anything goes. For example, volume and many indicators’ market technicians used to rely on will give the wrong outlook. What used to work accurately will no longer work as well or simply not work at all. This applies to both fundamental and technical analysis. A New Stock Market Trading Era In Trading is upon us.
As we stated before what is will no longer be and what is not, will be. One will need to be a modified contrarian or market technician to be able to deal with the swings. The point will be extremes. For example, a contrarian will no longer be able to say because the masses are jumping in its time to jump out. Instead, one will have to examine the speed at which they are jumping in, how many of them are jumping relative to the volume that was doing nothing just a few months ago, how much-staying power do they have and so forth.
Instead of selling, one would now use this data in the following manner. If the masses are jumping in after sitting out for a long time; it would be fair to assume that they have collected a lot of money while they were sitting on the sidelines. It would also be fair to assume that they are pissed off that they missed so much of the rally, and it would also be fair to assume that they want to make all the money they lost back and now think they are entitled to in record time. Given this scenario, then the new contrarian would simply wait for a pullback before loading up and riding the wave higher. The sentiment would have to reach the boiling point; everyone would need to be foaming at the mouth before the market puts in a long term top.
Based on the trend and our psychological analysis of the situation, we think that the Dow could roar to unimaginable heights before the markets crack and even when they crack they will not break the long term uptrend.
The Feds pulled a Houdini with their unrelenting quantitative easing program, and almost no one seems to have noticed this, or if they have virtually no one is talking about it. The Dow and SPX put new highs and based on momentum and old technical analysis theory which most seem to have forgotten; a real bull market begins only when the old highs have been taken out. The long-term trend remains strong so, for now, there is very little evidence of long-term weakness. A correction of up to 20% is possible. We will probably have two corrections one in the 10% ranges, and one in the 20% ranges both should be viewed as buying opportunities.
The media is pushing theories without all the data, and if you read almost all the stories you will see experts using words, such as may, could, might, but the masses treat these opinions as facts. Try to google the term “is the Coronavirus from the same family as the flu virus: “You won’t find any articles that answer the question directly in the top 10 search results. Instead, you will find a plethora of articles that go on describe how dangerous the new variant of the Coronavirus is. These articles were there before, but now they have been pushed to the bottom pages where no one bothers to look at.
The answer is simple, yes, it’s from the same family, but it’s a more virulent version. After going through six pages of results, I could barely find a straight answer on Google that discussed only the Coronavirus as it relates to influenza. I had to use duckduckgo.com and only then was I able to find something of value on the first page, but after scrolling down the article in question was I able to find the following info:
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