In a normal world there are warning signs of tops, lower highs, usually a slow roll over to begin with. It's quite likely this time there will be no warning, it will start going down like a normal correction and just keep going down, no short term relief rally bounce of any substance, just straight over the edge of a cliff. WhAt yA RecKon MurraY. Not a prEdictioN...........
After 10 years of idiots making top calls on here based on mostly nothing real, the laughing started many years ago on this topic. And simply calling a "top" is not enough, you have to correctly forecast the rough size of any correction and your strategy once the event occurs. You should note I have called corrections on several occasions during this bull, including late January 2018 and during the year 2015 I forecast an upcoming correction. You don't see me saying I'm sure what will occur within two months, even though I have forecast US market direction as good or better then almost anyone on this forum for years. In 2015, as the first interest rate hike approached, I correctly forecast a normal size correction was coming within months of the actual timing. When it occurred, there was the usual crew telling everyone we were in the midst of a generational crash. So you had S2007S for example saying we would drop 40-60% imminently from the mid 1900s on the SPX. Of course, these were disasterous ideas, and anyone reinvesting after markets dropped 10-15% ( as I predicted ) did extremely well. Who got the last laugh in that scenario ? Certainly not the bears expecting a crash.
See this is what I don't understand. Why predict at all? Who gives a !@#$? If you are a day trader, at the point where the market turns, sure you will lose some money because you have been trained to BTFD. But perhaps there will be a hard double top on the daily, or a H&S top, or price will stay firmly below 50/200 MAs (my favorite) or a channel break. Well before then though, you will probably lighten up and be more flexible because the market will likely be reducing its trading range. The point is the market doesn't "just" go down without some sort of external catalyst (9/11, Powell opening his mouth). If it's a technical reason (economy might be slowing, etc) that will be reflected in price movement. @Overnight will no doubt remind you of when Powell opened his big mouth and karate chopped the market in October 2018: What a time to go short! You lost a little bit of money on the turn but until the sentiment changed, it was short like a mother fucker until it bounced off of the 200 day MA. Let's take a look at the Great Recession Of 2018. What technical signals did we receive? 1. Small double top on daily 2. Channel break 3. Price below 50 DMA, then 200 DMA. 4. Price stays below HMA for N days You would have lost money on the turn, no doubt. SO WHAT? The two guys I find extremely useful to give me a market perspective are: 1. https://www.youtube.com/channel/UCtehAp4VxQSHrbNvVHEZ89g 2. https://www.youtube.com/channel/UC_ywfvIR2JrnMuZt33y7QYQ So here is how I will handle the turn: 1. If it is technical, I expect the chart to show me. So far, nothing aside from run of the mill noise. I expect people smarter than me to start talking about things other than feelings. 2. If Powell/Trump/Iran/Tupac do something or some terrible news comes in, I will gauge market sentiment and stick to that until sentiment changes I won't really predict the turn because I'm not that good. Even Dalio has to hedge against a turn. Why do you guys think calling a turn is useful at all?
Sir, you sound like a megalomaniac. I'm not interested in entering a piss contest with you. Now chill out. BTW I don't ever recall you posting a real trade. Just all talk.
In fact, the double top on hourly was textbook! second image from : https://www.investopedia.com/terms/d/doubletop.asp
You sound like someone who operates on emotions and can't accept data driven facts that put some doubt into your theories. You can come up with REAL reasons why markets may correct within two months, but comparing conditions to the end of the dot com isn't valid.
No, Powell's mouth alone had the biggest impact on his very first day on the job, Feb 5th 2018. The day after his 65th birthday, I came to learn later. It was an uncanny two weeks after that. Huge drop during his first week, and then a week later? Poof, back up to where it was. The Q4 2018 drop was more a gang-bang of the interest rate hikes IMHO. I did not see it coming, for sure, but it wasn't specifically anything Powell said on his own. More of a consensus as the rates started rising. Mreh. I miss Yellen and her easy-going *yawning* on rates, lol!