While the CNN fear and greed index can be a good indicator of short-term tops and bottoms, there is something more sinister at play here. Whenever the CNN fear and greed index goes to the extremes, a reflex bounce occurs to reset the sentiment. But that may not create the necessary conditions for a sustainable intermediate-term bottom. Here's why. The investors intelligence survey recorded some extremes in spreads between the bears and bulls. The spread even exceeded the 1987 top. I posted this many times on traders-talk.com. But this was largely ignored by amateurs and professionals alike, as the parabolic move gave a false sense of security that nothing could go wrong. The amount of froth and participation required to create a parabolic advance, in itself is a huge measure of sentiment. You don't need any sentiment surveys. Just one look at Dec 2017 to Feb 2018 charts of Bitcoin, ICOs and the S&P/DOW/Nasdaq should sum it all up. What differentiates a minor top from a...
At the outset, i would like to make it clear that i have nothing but respect for those with straight "A"s and i am in no way belittling their contribution to mankind. While their contribution in science, technology, literature etc has been tremendous, their IQ is of very little value when it comes to trading. In fact, it's a handicap. As a disclosure, I am one of those guys with straight "A"s but went through a long process of transfromation before i became a sucessful trader. I don't think there is any profession which is as counter-intuitive as trading. This is not a game for the perfectionists. This is not a game for those who are used to getting straight "A"s in their college. It becomes all the more difficult for those with impeccable academic credentials. Trading is all about imperfection. You get a lot of "F"s a.k.a stop-outs and occasional "A"s a.k.a winners, not exactly the kind of treatment the best and the brighte...
Thanks, Nav. I'll be following you here.
ReplyDeleteI second here, Nav. will follow you as well.
ReplyDeleteMany thanks NAV
ReplyDeleteHey NAV, any price point level you looking to get short today?
ReplyDelete