Stock picking is losing favor. On the other hand, passive investing is growing in popularity. This fits with the stock market’s Elliott wave pattern. The mania is not over, but the end might be closer than many investors realize
The Elliott wave model often indicates a stock market outlook that’s at odds with the sentiment of the crowd. But, that’s okay. The crowd is usually wrong at major market turns. For example, two years ago on May 9, 2015, the bull market was six years old and the third longest in history. A few days earlier, CNN Money said: As the bull market gets longer and longer, investors are getting jittery.
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There’s an old saying on Wall Street that goes “buy low and sell high.” It’s usually said in jest because it’s a feat that’s much easier said than done. History shows that most investors pile into bull markets just as they are about to end, and they do the opposite in bear markets: sell right near the bottom, when the fear is at its highest.
According to the news-focused analysts, commodities as a whole had resolved to quit their bear habits in 2011, and soar: “The bull market in commodities is likely to continue for some time.” (Dec. 8, 2010, Wall Street Journal). “The crash of 2008 in commodities was a mere blip… The rally in prices shows no signs of slowing.” (March 9, 2010, National Post)
Some Elliott wave forex traders do watch the news — but for different reasons By Elliott Wave International Last Friday, EURUSD rallied strongly. Said Reuters: “The U.S. dollar tumbled against a basket of major currencies…on U.S. political uncertainty after the FBI said it would review more emails related to Democratic presidential candidate Hillary Clinton’s private […]