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Friday, January 14, 2011

Women, money, stocks and speculation

When the environment is filled with risk seekers as markets generate gains, fear of losing drops to nil. Now note the following, which is not entirely dependent on





the aforementioned environ: anything, namely, stock issues, with consensus concerning it's attractiveness will not be as hotly pursued. it will be merely declared as just that; attractive, yet not as actively pursued. in fact, disregarded and left alone.  

yet that stock issue with a large divergence in consensus concerning it's attractiveness, will be given more attention, followed, noticed, and actively pursued; hardly left alone.

stock issues like this would be names with highly contested earnings figures, technical patterns, and in any state of uncertainty.

a moth to the flame. it must be in our human nature to seek out risk when investments are doing well in active pursuit to attain more.

  • it is exactly this activity that makes markets unable to be fabricated over any multi-year time frame, and possibly sooner as information technology enables this.

  • it is exactly this activity that generates advances in activity and prices followed by declines in prices with greater activity; 
  • where activity eventually declines, prices stabilize; until once again, 
  • activity begins to increase, prices advance, and 
  • the entire process repeats.

the Elliott wave principles capture this observation of nature very well. of all trading methods, principles, techniques and styles i have studied; many inherently depict these wave principles, either knowingly or not.

nevertheless, a requirement to speculation, no matter, one's methods, must be "reactive". this insures a flexible mental mindset which can avoid getting trapped into thinking market action will resolve as you imagine.

this thinking was prompted by the following study and applied to the arena of speculation. source OKtrends

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