You see, people can’t help themselves they prefer to be bearish. In
fact, it seems we are genetically predisposed to being pessimistic.
This is why the bearishness viewpoint sells. As one client who
subscribes to a perpetually bearish author recently put it:
The material might not be helpful, and even harmful. But, it gets the most clicks, as people are very drawn to scary viewpoints, and many take comfort and consolation in believing that the profits that they have missed out on by being more cautious will be wiped out when the big crash comes . . . In other words scary stuff sells. It does not need to stand up to careful scrutiny. Most people will never look carefully at the facts, and will believe what they want to believe.
Look at his last two sentences, as it rings of the sad truth in the market.
To quote Ben Franklin: “So convenient a thing is it is to be a reasonable creature, since it enables one to find or to make a reason for everything one has a mind to do.”
As I explained in other articles, we are predisposed to bearishness. So, we will ALWAYS look for a reason to be bearish. This is why bearish writers have received constant praise despite the fact that they have been wrong for years.
The subscribers to these sites heap praise upon them due to the fact that they have “opened their eyes to the reasons why the market will not go any higher.” Yet, as we have seen, the markets have continued significantly higher. So, the higher they go, the more they are grateful to bearish article writers for “saving them from the inevitable crash that is just around the corner.” All the while, they have missed the last 40+% rally in order to protect themselves from the next 5% downside.
In todays world it is much tougher to be a contrarian than it is to be a bear. To be a bear means you are simply following normal human behavior. So to be a bear in the stock market means that you will likely be wrong the most of the time. Therefore, if you follow your gut, it means that you likely have significantly under-performed the market.
So are we suggesting that you should turn bullish right now? Absolutely not, but it does mean that you need to analyze your investment mistakes over the last several years, and understand what were the factors that resulted in you making those mistakes. We sincerely hope you consider your perspective quite strongly before you are presented with another opportunity to take a long position in the equity market in the coming months.
Another truth in the market is that many investors will never admit to is that they were wrong and the market was right. In other words, price it truth, and we must learn to accept this. Anything that tries to explain why price is false is, by definition, is a falsehood. Yet, even seasoned investors will simply continue to list all the reasons why they were right and the market was wrong. It is irrational to believe that fighting the market is going to help anyone reach his or her financial goals?
One last shocking fact for you to consider: It is due to bearishness that the market has continued higher and higher. As unbelievable as it might sound, that is the truth. Until the entire market, as a whole, is convinced that this bull market is over it will never end, the market will continue to climb that wall of worry that each of the bears have helped to build these last 8 years.
Based upon our analysis, we still have several more years for this bearishness to persist, which will then be the time that this bull market that began in 2009 will finally come to an end. It is at that point that we will sincerely thank the Bears and all their wall of worry for pushing this market far beyond your expectations.
We want to remind those willing to listen that pullbacks and consolidations are inevitable and expected. That means the market will continue to whipsaw trade over the next few months, but as long as all these “bumps” we now experience remain below 2460-80 SPX resistance, we view this as being in a whipsaw type of market, ultimately making its way down to the 2300-2350SPX support area before this pullback or consolidation is completed in the coming months.
While we believe that there is a 20% probability that we can still hit 2500-2520 SPX, even in that lower probability scenario, it 80% likely we are headed down to the 2300-2350 before we are able to rally to 2600SPX, likely into 2018.
The material might not be helpful, and even harmful. But, it gets the most clicks, as people are very drawn to scary viewpoints, and many take comfort and consolation in believing that the profits that they have missed out on by being more cautious will be wiped out when the big crash comes . . . In other words scary stuff sells. It does not need to stand up to careful scrutiny. Most people will never look carefully at the facts, and will believe what they want to believe.
Look at his last two sentences, as it rings of the sad truth in the market.
To quote Ben Franklin: “So convenient a thing is it is to be a reasonable creature, since it enables one to find or to make a reason for everything one has a mind to do.”
As I explained in other articles, we are predisposed to bearishness. So, we will ALWAYS look for a reason to be bearish. This is why bearish writers have received constant praise despite the fact that they have been wrong for years.
The subscribers to these sites heap praise upon them due to the fact that they have “opened their eyes to the reasons why the market will not go any higher.” Yet, as we have seen, the markets have continued significantly higher. So, the higher they go, the more they are grateful to bearish article writers for “saving them from the inevitable crash that is just around the corner.” All the while, they have missed the last 40+% rally in order to protect themselves from the next 5% downside.
In todays world it is much tougher to be a contrarian than it is to be a bear. To be a bear means you are simply following normal human behavior. So to be a bear in the stock market means that you will likely be wrong the most of the time. Therefore, if you follow your gut, it means that you likely have significantly under-performed the market.
So are we suggesting that you should turn bullish right now? Absolutely not, but it does mean that you need to analyze your investment mistakes over the last several years, and understand what were the factors that resulted in you making those mistakes. We sincerely hope you consider your perspective quite strongly before you are presented with another opportunity to take a long position in the equity market in the coming months.
Another truth in the market is that many investors will never admit to is that they were wrong and the market was right. In other words, price it truth, and we must learn to accept this. Anything that tries to explain why price is false is, by definition, is a falsehood. Yet, even seasoned investors will simply continue to list all the reasons why they were right and the market was wrong. It is irrational to believe that fighting the market is going to help anyone reach his or her financial goals?
One last shocking fact for you to consider: It is due to bearishness that the market has continued higher and higher. As unbelievable as it might sound, that is the truth. Until the entire market, as a whole, is convinced that this bull market is over it will never end, the market will continue to climb that wall of worry that each of the bears have helped to build these last 8 years.
Based upon our analysis, we still have several more years for this bearishness to persist, which will then be the time that this bull market that began in 2009 will finally come to an end. It is at that point that we will sincerely thank the Bears and all their wall of worry for pushing this market far beyond your expectations.
We want to remind those willing to listen that pullbacks and consolidations are inevitable and expected. That means the market will continue to whipsaw trade over the next few months, but as long as all these “bumps” we now experience remain below 2460-80 SPX resistance, we view this as being in a whipsaw type of market, ultimately making its way down to the 2300-2350SPX support area before this pullback or consolidation is completed in the coming months.
While we believe that there is a 20% probability that we can still hit 2500-2520 SPX, even in that lower probability scenario, it 80% likely we are headed down to the 2300-2350 before we are able to rally to 2600SPX, likely into 2018.
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