Over the last few years, we have become very familiar with the work
of Dr. Cari Bourette. Dr. Bourette has, for many years, been studying
the overall impact of market mood upon society and the stock market. In
fact, she has built an algorithm, which is able to identify certain
turning points in the markets based upon this algorithm, but also to
identify those effects of market mood upon society.
Her post this past Saturday, September 30 was entitled “Terrorist Alert Through October 12, 2017.” Where she outlined her expectation that an attack can occur near Denver, Colorado:
We all know what happened in Las Vegas the very next day, a vile and terrifying attack. Whether or not the tragedy in Las Vegas was what her analysis was pointing to — and let’s hope and pray that there is nothing more — it does raise the question of whether analyzing social mood can help us predict more than just the stock market.
We believe that as further study is done into the effect of mass sentiment, there will be many more aspects of life for which this study can prepare us.
As for how social mood and sentiment analysis can produce relatively accurate predictions regarding the stock market, we hope you have seen evidence of this in our analysis over the years. More proof of this is presented when you look at the impact of news and external events on the markets.
Most of us are amazed that there has been no exogenous events over the last 18 months, which has had any effect upon the market trend. Somewhat sadly, the market has hit another all-time high even after the horrific events in Las Vegas.
As we have highlighted over and again, exogenous events do not effect market direction until the market sentiment patterns have run their course. Unfortunately we can add this event to the list of events, which have not halted this trend at all over the last year and a half, even when you throw in the referendum in Catalonia and the unrest seen in Spain as a result:
Brexit – Little to No Effect
Italian Referendum – No Effect
Interest Rate Rise – No Effect
Cessation of QE by the Fed and ECB – No Effect
Various Terrorist attacks – Little to No Effect
Russia Crimea Crisis – No Effect
Trump Surprise Win – No Effect
The Assertion that Markets are not trading on fundamentals – No Effect
Low Levels of Volatility – No Effect
High Levels of Volatility-No Effect
Record High Debt – No Effect
North Korea – Little to No Effect
Hurricane Damage in Texas, Florida, and Puerto Rico – No Effect
Catalan Referendum – No Effect
Las Vegas Attack- No Effect
The trading patterns we are seeing still suggests that as long as the SPY/SPX remains over 2485 (248.05 SPY) to 2495 (248.95 SPY) upper support, which can be divided into the 2575+ SPX (256.84 SPY) region by Thanksgiving before this wave tops and provides us a pullback to down to the 2350 (234.37 SPY) to 2400 SPX (239.37 SPY) region.
Having said all that, if the market should break that upper support, likely to happen next week, that provides initial warning that wave has topped as an ending diagonal. For now, the bulls remain in charge, and negative exogenous events will continue to have no impact upon the market until this wave pattern that started in February 2016 is completed.
Her post this past Saturday, September 30 was entitled “Terrorist Alert Through October 12, 2017.” Where she outlined her expectation that an attack can occur near Denver, Colorado:
We all know what happened in Las Vegas the very next day, a vile and terrifying attack. Whether or not the tragedy in Las Vegas was what her analysis was pointing to — and let’s hope and pray that there is nothing more — it does raise the question of whether analyzing social mood can help us predict more than just the stock market.
We believe that as further study is done into the effect of mass sentiment, there will be many more aspects of life for which this study can prepare us.
As for how social mood and sentiment analysis can produce relatively accurate predictions regarding the stock market, we hope you have seen evidence of this in our analysis over the years. More proof of this is presented when you look at the impact of news and external events on the markets.
Most of us are amazed that there has been no exogenous events over the last 18 months, which has had any effect upon the market trend. Somewhat sadly, the market has hit another all-time high even after the horrific events in Las Vegas.
As we have highlighted over and again, exogenous events do not effect market direction until the market sentiment patterns have run their course. Unfortunately we can add this event to the list of events, which have not halted this trend at all over the last year and a half, even when you throw in the referendum in Catalonia and the unrest seen in Spain as a result:
Brexit – Little to No Effect
Italian Referendum – No Effect
Interest Rate Rise – No Effect
Cessation of QE by the Fed and ECB – No Effect
Various Terrorist attacks – Little to No Effect
Russia Crimea Crisis – No Effect
Trump Surprise Win – No Effect
The Assertion that Markets are not trading on fundamentals – No Effect
Low Levels of Volatility – No Effect
High Levels of Volatility-No Effect
Record High Debt – No Effect
North Korea – Little to No Effect
Hurricane Damage in Texas, Florida, and Puerto Rico – No Effect
Catalan Referendum – No Effect
Las Vegas Attack- No Effect
The trading patterns we are seeing still suggests that as long as the SPY/SPX remains over 2485 (248.05 SPY) to 2495 (248.95 SPY) upper support, which can be divided into the 2575+ SPX (256.84 SPY) region by Thanksgiving before this wave tops and provides us a pullback to down to the 2350 (234.37 SPY) to 2400 SPX (239.37 SPY) region.
Having said all that, if the market should break that upper support, likely to happen next week, that provides initial warning that wave has topped as an ending diagonal. For now, the bulls remain in charge, and negative exogenous events will continue to have no impact upon the market until this wave pattern that started in February 2016 is completed.
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