Hey guys,just wanted too get your opinion on where we are at on the market stage?
Stage 1
This stage is a sideway consolidation period following the bear market, smart money enters the market to build a floor.
Stage 2
This stage is referred to as the bull market, in the early stages there is brief mention over the media that the markets are showing signs of optimism; investors show signs of interest, but are too fearful to enter the market. The media, especially in the newspaper, show signs of new growth and optimism, investors pay attention and dip their toes in to the market.
Majority of the news is very optimistic, analyst and brokers are projecting huge earnings growth for the future while the stocks often hold big valuations as a result of these expectations. Often time, the smart money and the insiders are selling out to the dumb money pouring in as they believe that they have seen a peak in growth for their industry.
Stage 3
This is the topping phase, Wall Street goes into a euphoric state, analysts and brokers are getting their clients to buy. Euphoria reigns, investors are buying in greater volume. Smart money is completely out of the market.
Stage 4
This stage is referred to as the bear market, the market sells off, mass exodus from investors running to safe havens, the move ends the market falls and investors lose money.
Upon the completion of stage 4, the cycle repeats.
I reckon we are in stage 3 of the market cycles, what are your thoughts?
http://www.gambitrader.com/forums/content.php?337-Market-Stages
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