Stock Market Sentiment Analysis: Sell Euphoria & Reap Rewards

stock market sentiment analysis

Stock Market Sentiment Analysis: Euphoria Decoded for Market Peaks

Updated Feb 2023

Even though things are viewed as bad now, these times will be viewed as the good old days in the not-too-distant future. We also expect the polarisation mega-trend to gather even more traction. Most importantly, the Market of Disorder will move into the second phase.

In this phase, things will appear even more disorderly, at least to the masses and experts of yesteryear. Expect many well-known and renowned experts to stumble and make fools of themselves as their predictions fail to materialise.

We believe that the markets are setting up for a substantial correction next year. Almost every asset class except for precious metals has soared in value. A strong stock market correction could lead to secondary effects, such as cooling the steaming hot housing market. Market Update Nov 11, 2022

Federal Influence Unraveled: Mastering Stock Market Sentiment Analysis

The Fed need an “oops, I did it again Britney Spears moment so they can renege on their promise to taper. Hence, the Fed is likely to engineer a substantial correction. Nothing shocks the crowd more than when their pie-in-the-sky dreams are shattered. This will address the labour shortage problem in one shot, and the Fed will have a valid reason to default on its promise to taper. Market tops provide central bankers with an almost 100% chance of reneging on their old promises. More importantly, market sentiment will turn bearish, providing the impetus for the next bull run. 

The Fed’s mission is to keep printing money forever. We are in the forever QE mode. They will use all sorts of tricks to achieve this. One will be via the IRS, where monthly checks are sent out to help families meet their daily expenses. This is already underway.

Eventually, this will morph into universal income, which, believe it or not, will be the ultimate QE. Ultimate because most individuals will never consider that free handouts equate to QE. The Fed’s goal is to debase a given currency. Handing money is a nifty way of achieving this objective while pretending to help the needy.

 

 

Epochal Stock Market Sentiment Analysis

Market Tops tend to occur when Bearish sentiment is trading in extremely low ranges.

table of market tops values

anxiety index bnb index

 

For the first time this year, we have three back-to-back readings where bullish sentiment is trading above its historical average. The first strong confirmation is that the markets will put in a multi-week top next year. Market Update Nov 11, 2021

The Fed needs a solid correction to scare the living daylights out of the masses. When panic sets in, the mass mindset is open to any and all suggestions, even if they are detrimental to the individual’s health in the long term. Many good men have tried to argue and prove that the masses can be saved, but thousands of years later, the masses are still cannon fodder.

They do what they excel at, running instead of strolling and strolling when they should be running. In other words, the secret desire to lose syndrome is so strong that they go out of their way to destroy any chance of achieving long-term success.

Signs to watch for that the market will top next year

The first sign that a top is in place is that a series of lower highs follow a new bliss. The market lacks the oomph to take out its old highs. In some instances, it comes dangerously close to doing so. This provides the latecomers to the party with enough fodder to create the illusion that the market is building steam for a higher move. These lower highs lead to a “channel formation”. Channel formations are very bullish if they form after the markets have sold off or are trading in the oversold ranges. The opposite applies when they take shape in a highly overbought market.

One of the more apparent signs of a top is that bullish readings remain unusually high during this sideways action. The dumb money is sure that this sideways action represents another buy-the-dip opportunity. However, they fail to take note of the unusually high bullish sentiment. An offshoot is that bullish sentiment trades slightly above its historical value, but Neutral sentiment surges. When the market is trending sideways, either development indicates that a top is in place.

 

Other Articles of Interest

The Stock Market Forecast for Next 3 months: its better than you think

Stock Market Forecast For Next 3 months: Buckle Up

Unravelling the Secrets of Stock Market Success Updated August 1,  2023 Before attempting to predict the stock market's direction for ...
False Information trends

False Information and Its Consequences

How False Information is Fueling the Insane Bull Market Updated July 30, 2023 Indeed, the proliferation of false or misleading ...
Unveiling Mass Psychology: The Essential Element for Sustainable Triumph

Mass Psychology & Financial Success: An Overlooked Connection

An Introduction to Mass Psychology: Understanding Group Behavior? Updated July 15, 2023 Mass psychology is a branch of social psychology ...
The Level Of Investment In Markets Often Indicates the Financial Pulse

The Level Of Investment In Markets Indicates Fear Or Joy

Editor: Vladimir Bajic | Tactical Investor The level of investment in markets often indicates Panic or? Updated July 2023 The ...
right side of trend

Winning with Nasdaq 100 ETF: Riding the Right Side of the Trend

Unlocking the Potential of the Nasdaq 100 ETF: A Comprehensive Guide July 7, 2023 It is crucial to bear in ...
Riding the Waves: Exploring the Dynamics of Stock Market Trend Analysis

Stock Market Trend Analysis Decoded: Unveiling the Insights

Decoding Stock Market Trend Analysis: Unveiling the Insights Updated July 5, 2023 Disorganized data analysis was previously discussed in the ...
Market Fear: Don't panic and never follow the crowd

Market Fear Unleashed: The Cost of Stupidity in Investing

Market Fear Exposed: Unraveling the Costs of Fear & Folly in Investing Updated June 2023 The most effective, and perhaps ...
The place mass psychology and technical analysis converge to create the ultimate stock market timing system

Unraveling Crowd Behavior: Deciphering Mass Psychology

Defying the Crowd: Navigating the World of Non-Conformist Behavior Updated June 2023 Mass psychology is a fascinating field that plays ...
Understanding Crowd Psychology

Crowd Psychology: Unlocking Success in the Stock Market

 Updated June 2023 The Power of Crowd Psychology in Investment Decision Making The articles below aim to clarify the often-misunderstood ...
Risk to Reward Ratio

Risk To Reward Ratio & Opportunity Vs Risk

The Risk to Reward Ratio Dilemma: A Contrarian Perspective Updated June 2023 The risk to reward ratio, a fundamental concept ...
AI crimes

Real life doppelgangers

June 27, 2023 AI Perils Unleashed: Brace Yourself for Real Life Doppelgängers The video below sheds light on the perils ...
Unlocking Market Trends: Exploring Technical Analysis of the Financial Markets

Unveiling Secrets: Technical Analysis for Dummies

Demystifying Technical Analysis for Dummies: Unlocking Secrets Updated June 24, 2023 Technical analysis of financial markets is an approach that ...
What happens if the Stock Market Crashes: Jump in and buy

What Happens If The Market Crashes?

Updated June 2023 What happens if the Stock Market Crashes? Opportunity!!!!  When The masses panic: the smart money buys. Sol ...
Richard Russell Dow Theory, Useful or invalid

Richard Russell’s Dow Theory: Is It Still Valid?

 Richard Russell's Dow  Theory Signals Updated June 2023 Our perspective still favours the idea that a better alternative exists to ...
Random Thoughts: The Intricate Web spun by devious individuals

Random Thoughts: Web of lies Woven by Powerful Individuals

Random Thoughts: Resilient Minority's Struggle Against Overwhelming Odds June 18, 2023 It is essential to comprehend that the abandonment of ...