They say it cannot be done, their wrong
“We are drowning in information while starving for wisdom.”
Through its own language, the stock market has anticipated every major decline in my 30 plus years on and off Wall Street. The problem for the majority is not knowing WHY? This quintessential of human question keeps investors from selling when it is the question WHAT is the market telling me that matters. The WHY question is answered later, much later, when it’s too late. When the Macro Economic reasons are clear, the bear market is over, Hence the cliché buy “recessions and sell the boom.”
In the 20th century and the first two decades of the 21st century, every major top has been anticipated by the stock market’s language, its price-based communications.
Sure, there were two exceptions, sort of. I have read that after World War-II they thought there would be a post-war depression but it didn’t happen, yet the market went down; and again before my time in the business, in 1962 the Macro types expected a recession again it never materialized but the market experienced a bear anyway.
I think it is curious that when the “experts” anticipated what was going to bring the market down the markets went down but their reasoning regarding WHY did not happen, they were wrong.
With that understood, in every instance during my lifetime the market in its language has given – sufficiently in advance- the message that price was changing and it was time for Risk-Off.
NB: the same applies to major lows.
Great and Many Thanks,
Jack F Cahn, CMT, and founder of Contrary Thinker
Here are two books for your library, grow your mind.
“The Nature of Risk: Stock Market Survival & The Meaning of Life” (Contrary Opinion Library) By Mamis, Justin
“When to Sell: Inside Strategies for Stock-Market Profits” By Mamis, Justin
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