Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24
At These Levels, Buying Silver Is Like Getting It At $5 In 2003 - 28th Oct 24
Nvidia Numero Uno Selling Shovels in the AI Gold Rush - 28th Oct 24
The Future of Online Casinos - 28th Oct 24
Panic in the Air As Stock Market Correction Delivers Deep Opps in AI Tech Stocks - 27th Oct 24
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump! - 27th Oct 24
UK Budget 2024 - What to do Before 30th Oct - Pensions and ISA's - 27th Oct 24
7 Days of Crypto Opportunities Starts NOW - 27th Oct 24
The Power Law in Venture Capital: How Visionary Investors Like Yuri Milner Have Shaped the Future - 27th Oct 24
This Points To Significantly Higher Silver Prices - 27th Oct 24
US House Prices Trend Forecast 2024 to 2026 - 11th Oct 24
US Housing Market Analysis - Immigration Drives House Prices Higher - 30th Sep 24
Stock Market October Correction - 30th Sep 24
The Folly of Tariffs and Trade Wars - 30th Sep 24
Gold: 5 principles to help you stay ahead of price turns - 30th Sep 24
The Everything Rally will Spark multi year Bull Market - 30th Sep 24
US FIXED MORTGAGES LIMITING SUPPLY - 23rd Sep 24
US Housing Market Free Equity - 23rd Sep 24
US Rate Cut FOMO In Stock Market Correction Window - 22nd Sep 24
US State Demographics - 22nd Sep 24
Gold and Silver Shine as the Fed Cuts Rates: What’s Next? - 22nd Sep 24
Stock Market Sentiment Speaks:Nothing Can Topple This Market - 22nd Sep 24
US Population Growth Rate - 17th Sep 24
Are Stocks Overheating? - 17th Sep 24
Sentiment Speaks: Silver Is At A Major Turning Point - 17th Sep 24
If The Stock Market Turn Quickly, How Bad Can Things Get? - 17th Sep 24
IMMIGRATION DRIVES HOUSE PRICES HIGHER - 12th Sep 24
Global Debt Bubble - 12th Sep 24
Gold’s Outlook CPI Data - 12th Sep 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

8 Stock Market Indicators in 1: Here's the Message of the Panic/Euphoria Model

Stock-Markets / Stock Market 2021 Apr 19, 2021 - 02:06 PM GMT

By: EWI

Stock-Markets

Prior model extremes occurred in March 2000 and October 2007

Elliott Wave International has been providing market analysis for more than four decades -- which includes many bull/bear market cycles.

That said, the public's current market mindset -- especially among inexperienced investors -- is a reminder of the extremes surrounding the 2000 market top, and a few others.

For example, a February 27 MarketWatch headline said:

A new wave of fearless retail investors is ready to pour $170 billion into stocks ...

Also, according to an early February Deutsche Bank survey of online brokerage users, 61% are under 34 years of age and 45% are in their first year of investing.


As Barron's reports (Feb. 25):

Younger, Savvier Investors Are Making Up a New Movement

So, all in all, there's no shortage of financial optimism.

Indeed, the March Elliott Wave Financial Forecast, a monthly publication which provides analysis of major U.S. financial markets, showed this chart and said:

This chart shows SentimenTrader.com's version of the Panic/Euphoria Model, which is an amalgamation of eight indicators that range from New York Stock Exchange short interest to individual and advisory sentiment surveys and retail gas prices. Prior model extremes occurred at 1.413 on March 24, 2000, the day of the top in the S&P 500 that led to a 51% decline, and 1.337 on October 12, 2007, one day after the S&P 500 peaked and started a 58% decline. The other two extremes were 1.427 on January 7, 2011 and 1.444 on April 8, 2011, neither of which mattered immediately to stock prices, but the S&P soon declined 22% from May 2, 2011 to October 4, 2011. On February 12, 2021, one trading day before the high in the NASDAQ indexes, euphoria clearly got the best of the investment public as the model shot to a new record at 1.613.

It's important to know that this extreme in optimism ties in perfectly with what the Elliott wave model is conveying right now.

The beauty of the Elliott wave model is that it can help you to anticipate trend changes.

Here's a quote from Frost & Prechter's Elliott Wave Principle: Key to Market Behavior:

It is a thrilling experience to pinpoint a turn, and the Wave Principle is the only approach that can occasionally provide the opportunity to do so.

The ability to identify such junctures is remarkable enough, but the Wave Principle is the only method of analysis that also provides guidelines for forecasting.

Learn these Elliott wave guidelines for forecasting financial markets by reading the online version of Elliott Wave Principle: Key to Market -- 100% free!

All that's required for free access to this Wall Street classic is a Club EWI membership -- which is also free. Club EWI is the world's largest Elliott wave educational community (approximately 350,000 worldwide members) and members get free access to a treasure trove of Elliott wave resources on financial markets, investing and trading.

Get started now by following this link: Elliott Wave Principle: Key to Market Behavior -- free access.

This article was syndicated by Elliott Wave International and was originally published under the headline 8 Indicators in 1: Here's the Message of the Panic/Euphoria Model. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in