Basically this is just my roadmap for 2020 and a brief outlook on what COULD happen and what i think the most likely scenario is. Doesn't take a genius to figure it out. The run-up on stocks draws in a lot of new investors, who can now invest with ease and trade on their mobile phones from apps like robinhood and etoro. We are in a period of extremely low volatility, and the volatility always comes when you least expect it. Traders get confident in their positions, leverage is increased and then the unexpected comes and liquidations start rolling. So far the market has been running up based on this continuous china trade wars drama. Here is a diagram that has been posted for months on Twitter. Market usually buys the rumours and sells the news. Mr chosen one found the glitch in the system by indefinitely delaying the "news", so there was no reason to sell-off. But now this deal seems to be coming to an end. We will slowly run out of news to pump on, and Trump is likely to spare any good news only until after the elections. The biggest thing is that the US presidential elections are coming in 2020. There is no bigger event for the markets. Stocks move around crazily when mr. Trump starts tweeting, now one can only imagine what happens when his position get threatened!!! Politics are a show in and of itself and now everyone can trade from their phone. This is a dream come true for market manipulation. I am not foolish enough to call tops on the market when it's rallying up, because i have no clue where it ends and stupid bulls make more money than the smartest of bears do. Long until wrong, because it works . But i can tell you one thing. If volatility is ever to come, it's coming in 2020 and the market is going to flush hard when it does. When you live in a fast-paced market, you go through these cycles in a relatively short time span. When the volatility is low, people get confident and at some point the shift comes and it is unexpected. If you are new to the markets, you would have not anticipated something like that even in your worse nightmares. Yet it happens and because it is not expected, people do not use a stop loss, they keep adding to losing position, over-leverage and as a result - you get liquidated and you can lose everything. It can be shocking and life can turn upside down in a bleep. This is a historical bull market, so you better enjoy the rally! But i think it's really important to remind yourself of the bigger picture and what 2020 is all about.
March 2020 would be 20 years after the bubble top in 2000. We could see some sort of correction in the second quarter of next year.
i agree that op did write like he's been under a rock... 2017 was smooth though.. from feb '18 to Aug '19 you can look at it as an 18-month consolidation... my indicators do say that dumb money has LOST chips during this period... so the consolidation is real. that said.. my pro boys have a tendency to play things out in roughly equal time periods, which means smooth riding for the next 15 months. of course any prediction so far out needs a lot of salt.
Based on historic volatility the volatility we had in the last 3 year cant be called low but has not been particularly high either. There were a few good spikes. But nothing like 2000 to 2003 or late 2007 to end of 2009. In fact the 2010's were relatively quiet years trading wise compared to the volatility we had in the Naughties when there were 2 massive crashes. Hopefully that kind of volatility will return in the 2020's.
Liking what i'm seeing so far, exactly as i described. A smooth sail is expected. Volatility comes when you don't expect it, duhh
Fed only knows how to print money and prop markets. And yes it made allllllll the difference, without the fed the markets would be 75% lower but of course no one believes this. The fed does. Nothing but print money to hand directly to wallstreet .