Why is Elite Trader a good contra indicator?

Discussion in 'Trading' started by veritas007, Dec 1, 2008.

  1. It seems to me that people make bullish posting right before the market goes down and vice-versa. Is there an actual correlation or is it just in my head? Why does this happen?

    My theory is that people try to justify their long positions by posting bullish posting. However, this mean that at some point they would have to sell their position putting downward pressure on the market. However, how representative is some random guy on elite trader of "stupid" money?
  2. Most wannabe traders and investors always have a bullish bias.

    As for the contrarian indicator. If you got a monkey to guess bull or bear the percents of either one would be close to the guesses on this website.
  3. It's simple: the market is a tricky, slippery beast whose job it is to fool most of the people most of the time.

    Any time it becomes predictable, the predictability is self-destroying as people try to jump on it. The pros know this of course, and play the crowd's psychology in order to part them from their money.

    I would say ET folks on average are no better than the guy in the street about predicting market direction. That's because it's very difficult, if not impossible, to do most of the time.
  4. Keep in mind that the market has been flat since Otober 10th so it's not like bears are making much money. We're still stuck in a trading range that will breakout to the upside very soon.
  5. The sheep who get slaughtered are the ones one there with a crystal ball trying to "predict" what the market is going to do...predict the future...no thanks.

    As for ET I wouldn't say its a contra indicator simply because for every bottom caller there is someone saying its just beginning and vice versa. Every outcome is being advocated by at least one person.

  6. I also noticed that when someone makes a wonderful post about some market statistic….that it always fails. None the less he is ET king for a day.
  7. Good post, we need some stars to rate good posts.
  8. so stating the obvious is a good post?