The economy is still too strong to induce an equities bear market or economic recession https://bullmarkets.co/traders-should-care-about-recession/
Something just happens and it's over. Many people who trade fully recognized the dotcom and r/e bubbles but also knew that it was not financially practical to bet on its end. We're in another one. Signs are all there. A lot of people in their 20's and 30's are collectivelly going to have 100's of billions lost in the decentralized Ponzi scheme known as crypto currency. Look at the coinmarketcap dot com site and realize most of those are going to zero when the bubble ends. And I`ve said this over and over again, look at Ross Cameron's "Warrior Trading" on YouTube. He's pulling in a MINIMUM of $600 per person (most spend $3000-5000 before they wise-up) over several months in "educational material" from 1000's of people all over the world based off of a SIMPLE breakout system, making millions for himself hand over fist. You can only do that in raging bubble markets. It probably doesn't end well for ole Ross. The SEC takes a dim view of front-running and real-time trade calls without having a Series 7 or CTA certification. These characters don't do that as it opens them up to litigation. There was an article this past week that said over 70% of Silicon Valley start-ups are going bankrupt, not seen since the dotcom. Crazy things going on... see as many theater movies as you want for only $9.95 a month with MoviePass? All those folks under 40 who didn't get heavily damaged financially from the last 2 big bubbles. Now they're all over the world, trading from their smart phones, a 1000 here, a 1000 there, thinking that day and swing trading are now a natural part of their daily lives. That's not normal thinking. It adds up. You'll see a lot of articles sayimg that "this time is different". No, really, it's not. Way too many mega-mergers going on. If things are going so great then why are companies buying each other out instead of growing organically? Greed and fear.
Your post ignores the premise of the OP's study: that the financial market precedes the economy. Your post supposes instead that retail traders/trading drives the financial markets -- rather than all that wisdom/experience that points to the bond markets or the futures markets as reliable precursors. Retail traders are moving hundreds of millions of dollars, that is true. (Maybe billions, if your time lens is generous enough.) Bonds and futures, however, move hundreds of billions -- and into $trillions. We've stepped off of a nine-quarter climb, and had our vaunted 10% drop. We've kissed/crossed a "200-day moving average" -- and many have called for a bear. The OP's study simply says, "Not so fast..."
Hey, have you hacked my computer? I randomly stumbled across WarriorTrading a few weeks ago and I've watched lots of his YouTube videos. I've learned the systematic formula and approach to shares trading... In Australia, I can personally tell you that a lot of failed Futures traders (namely Bonds/spreaders) went to start trading Shares and have had success for themselves. From the stories out there, it seems like a lot of them are getting away with murder in terms of the risk/reward plays they do... This is kind of strange that you have noticed the bubble as well... almost comical. It really must be easy-mode for shares traders for the past 2-3 years. I have analyzed most of Ross' strategies from his videos and I can tell that him and Tim Sykes' strategies involve a formula of: 1. Wake up, look at the Stock Scanner for high volume and gapping activity in pre-market 2. Watching the first 1-3 hours of stock open (mid-caps / smaller-caps) 3. Taking trades based off their setups What I personally noticed is 90% of their money is made off simple Break-out systems. They look for Bull flags (market breaks up, consolidates, tries to break up again)... I thought this system was immune from flaws initially.. but then you realise the frequency of these moves can only happen in a raging bull market. Isn't it possible to trade shares from the short side as well? He does have strategies for shorts.. Example: if something looks "toppy" they will short and ride it to VWAP or moving-average (EMA or SMA) usually a period of ~10 (1-min) or ~20 (5-min candle). If you figured this out then it probably is a bubble. I thought these guys were all sick kunts but it turns out the massive frequency of trades is occurring because on average we're in a "euphoric" state where companies are getting lots of bubble love... Just a caveat for anybody reading this: In shares, your edge is primarily in participating when there is large amounts of retail volume that overwhelms the algorithms. This makes the price-action look fluid on a chart (and the book), and the candles have a lot of wiggle room too (because the average retail punter doesn't really know how to price things). I've seen every single good time fade away eventually.. perhaps this "shares" bubble is prone to retail volume drying up if people get bitten from the market? If anybody has some more insight on this, I would love to get a discussion
Almost by definition the "top" is when everything is going well for bulls, or it wouldn't be a top. By the time everyone realizes that it's all gone to hell, that's nearer to the bottom. October 11th 2007, the DJIA hit 14,198.10. No banking issues, no Libor problems, still a year before the Presidential election, subprime was becoming a thing, but most on the market channels were saying it would recover ... that's the day the market put the top in, just a random Thursday, no fanfare, FED news, barely anybody was even paying attention. Just another happy day in the bull market. Some random market news around October 11th 2007. http://money.cnn.com/2007/10/09/markets/markets_0500/ https://nypost.com/2007/10/11/home-credit-crisis-targeted/ Then this guy, well, he seemed a little concerned about what was going on leading up to October 11th 2007. And everybody was saying he was wrong.
the world just has more debt-if we lived our lives like governments run economies we'd be in prison for fraud. Truth creates bear markets, lies creat bull markets. We have been in recession since 2003 more or less if you absent the staggering debt mountains. Economists are not finance people and finance people are mostly chancers, funded by fraud
Trump's economic lunacy will kick in soon. The US people will be paying for it. He is making the US a closed economy. Everything made will cost a lot more. Not only is he taking on China but the EU, Canada, Mexico etc. as well.
I think it's funny when people say the economy is good so no bear market on the way. It wasn't that many years ago when the economy sucked, but the market did well anyway(QE)...people said back then the economy and the market don't have anything to do with each other. So, which is it people?