Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
US Economy Has Been in an Economic Depression Since 2008 - 22nd Oct 21
Extreme Ratios Point to Gold and Silver Price Readjustments - 22nd Oct 21
Bitcoin $100K or Ethereum $10K—which happens first? - 22nd Oct 21
This Isn’t Sci-Fi: How AI Is About To Disrupt This $11 Trillion Industry - 22nd Oct 21
Ravencoin RVN About to EXPLODE to NEW HIGHS! Last Chance to Buy Before it goes to the MOON! - 21st Oct 21
Stock Market Animal Spirits Returning - 21st Oct 21
Inflation Advances, and So Does Gold — Except That It Doesn’t - 21st Oct 21
Why A.I. Is About To Trigger The Next Great Medical Breakthrough - 21st Oct 21
Gold Price Slowly Going Nowhere - 20th Oct 21
Shocking Numbers Show Government Crowding Out Real Economy - 20th Oct 21
Crude Oil Is in the Fast Lane, But Where Is It Going? - 20th Oct 21
3 Tech Stocks That Could Change The World - 20th Oct 21
Best AI Tech Stocks ETF and Investment Trusts - 19th Oct 21
Gold Mining Stocks: Will Investors Dump the Laggards? - 19th Oct 21
The Most Exciting Medical Breakthrough Of The Decade? - 19th Oct 21
Prices Rising as New Dangers Point to Hard Assets - 19th Oct 21
It’s not just Copper; GYX indicated cyclical the whole time - 19th Oct 21
Chinese Tech Stocks CCP Paranoia, VIES - Variable Interest Entities - 19th Oct 21
Inflation Peaked Again, Right? - 19th Oct 21
Gold Stocks Bouncing Hard - 19th Oct 21
Stock Market New Intermediate Bottom Forming? - 19th Oct 21
Beware, Gold Bulls — That’s the Beginning of the End - 18th Oct 21
Gold Price Flag Suggests A Big Rally May Start Soon - 18th Oct 21
Inflation Or Deflation – End Result Is Still Depression - 18th Oct 21
A.I. Breakthrough Could Disrupt the $11 Trillion Medical Sector - 18th Oct 21
US Economy and Stock Market Addicted to Deficit Spending - 17th Oct 21
The Gold Price And Inflation - 17th Oct 21
Went Long the Crude Oil? Beware of the Headwinds Ahead… - 17th Oct 21
Watch These Next-gen Cloud Computing Stocks - 17th Oct 21
Overclockers UK Custom Built PC 1 YEAR Use Review Verdict - Does it Still Work? - 16th Oct 21
Altonville Mine Tours Maze at Alton Towers Scarefest 2021 - 16th Oct 21
How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
The Only way to Crush Inflation (not stocks) - 14th Oct 21
Why "Losses Are the Norm" in the Stock Market - 14th Oct 21
Sub Species Castle Maze at Alton Towers Scarefest 2021 - 14th Oct 21
Which Wallet is Best for Storing NFTs? - 14th Oct 21
Ailing UK Pound Has Global Effects - 14th Oct 21
How to Get 6 Years Life Out of Your Overclocked PC System, Optimum GPU, CPU and MB Performance - 13th Oct 21
The Demand Shock of 2022 - 12th Oct 21
4 Reasons Why NFTs Could Be The Future - 12th Oct 21
Crimex Silver: Murder Most Foul - 12th Oct 21
Bitcoin Rockets In Preparation For Liftoff To $100,000 - 12th Oct 21
INTEL Tech Stock to the MOON! INTC 2000 vs 2021 Market Bubble WARNING - 11th Oct 21
AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
Stock Market Wall of Worry Meets NFPs - 11th Oct 21
Stock Market Intermediate Correction Continues - 11th Oct 21
China / US Stock Markets Divergence - 10th Oct 21
Can US Save Taiwan From China? Taiwan Strait Naval Battle - PLA vs 7th Fleet War Game Simulation - 10th Oct 21
Gold Price Outlook: The Inflation Chasm Between Europe and the US - 10th Oct 21
US Real Estate ETFs React To Rising Housing Market Mortgage Interest Rates - 10th Oct 21
US China War over Taiwan Simulation 2021, Invasion Forecast - Who Will Win? - 9th Oct 21
When Will the Fed Taper? - 9th Oct 21
Dancing with Ghouls and Ghosts at Alton Towers Scarefest 2021 - 9th Oct 21
Stock Market FOMO Going into Crash Season - 8th Oct 21
Scan Computers - Custom Build PC 6 Months Later, Reliability, Issues, Quality of Tech Support Review - 8th Oct 21
Gold and Silver: Your Financial Main Battle Tanks - 8th Oct 21
How to handle the “Twin Crises” Evergrande and Debt Ceiling Threatening Stocks - 8th Oct 21
Why a Peak in US Home Prices May Be Approaching - 8th Oct 21
Alton Towers Scarefest is BACK! Post Pandemic Frights Begin, What it's Like to Enter Scarefest 2021 - 8th Oct 21
AJ Bell vs II Interactive Investor - Which Platform is Best for Buying US FAANG Stocks UK Investing - 7th Oct 21
Gold: Evergrande Investors' Savior - 7th Oct 21
Here's What Really Sets Interest Rates (Not Central Banks) - 7th Oct 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Crashes; the Greater the Deviation, the Better the Opportunity

Stock-Markets / Stock Market 2017 Oct 14, 2017 - 02:29 PM GMT

By: Sol_Palha

Stock-Markets Ability is a poor man's wealth.M. Wren

The reaction when the market starts to correct is the same; run for the hills, the world is ending or some variation of that theme. However, if you spend a little time on looking at the history of the markets; one thing becomes clear. Those that panic gets hammered and those that remain calm walk away with the spoils.


 One way to visually see the “deviation factor” is through the use of standard deviation bands. Many software programs on the market will automatically fill in the Standard Deviation (SD) bands; Ideally, the setting should be set at 3SD from the norm, but settings of 2SD will suffice if you are unable to alter the settings manually. When the markets touch these ranges, and the trend is up, then backing up the truck is the thing to do.

Big Charts does not allow you to change the settings, they are fixed at 2SD, but there are sites out there that will let you adjust the settings.  Despite this limitation, one can immediately spot two great opportunities; 2003 and 2009, clearly illustrating that fear never pays.  As long as Fiat is in play, the Fed will attempt to reflate the economy. Naysayer after naysayer has stated that one day the masses will wake up, well they are still waiting for that day. Most don’t even know what Fiat stands for, and even fewer are willing to give it up.  There is a saying don’t fight the Fed, and so far that saying has held true.

 Strong corrections falling in the 2SD ranges and beyond should be embraced. From a long-term perspective, every back-breaking correction or crash has proven to be a buying opportunity. Knowing the trend does help and we put that to maximum usage; it's for this reason we have adamantly stated that the Bull Market the bears were calling an end for would not end shortly. Several years later, and the Bull as we foretold remains strong; the bull market will end but not before the crowd embraces it like a long lost love

Stock market crashes should be viewed through a bullish lens,

 But how do you get out of the market at the right time, First of all, forget about trying to time the exact top, instead focus on the emotion? When the crowd turns euphoric, it is time to take money of the table and or tighten your stops.  As you can see from the latest reading below the crowd is still antsy.

This is an old bull market, and it continues to trend higher because the crowd is still nervous and the most individuals think this market cannot and should not trend higher; that is why it probably will continue to trend higher.  For almost several years on end we have been stating that this bull market would trend higher than the most ardent of bull’s expectations and so far that’s exactly what this bull market has done. 

History never changes; the markets will experience one very strong correction before this bull keels over.  The problem is that the masses have been waiting for a strong correction since roughly 2013.  The ironical part is that the markets will pull back strongly, but most likely they will be trading at a higher level than they were at 2013. In 2013 the Dow was trading in the 12,800-13,000 ranges. While it is possible that the Dow could drop to this level, it is a low probability event as the masses are far from Euphoric at the moment.  Most likely the Dow will shed 25%-30% from its highs. Assume the Dow trades to 22K; at the extreme end, the Dow could drop to the 15,600 ranges.  Market Update June 18, 2017

Until the trend turns negative, we can only make educated guesses regarding the intensity of the next correction. As Fiat money rules the world, even more, money will be poured into the next created financial disaster, which will eventually push the market to new all-time highs. Until the people reject Fiat, the Fed will continue to create boom and bust cycles purposely; that is their primary agenda. Examine the history of the Fed, and you will see that they have gone out of their way to create these cycles. Volatility is a trader's best friend and the higher the market trends, the more volatile the ride. As the volume of the money supply increases so will the volatility.

Ability will never catch up with the demand for it.

Malcolm S. Forbes

by Sol Palha

www.tacticalinvestor.com

Sol Palha is a market analyst and educator who uses Mass Psychology, Technical Analysis and Esoteric Cycles to keep you on the right side of the market. He and his partners are on the web at www.tacticalinvestor.com.

© 2017 Copyright Sol Palha- All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in