Ignorance is rarely refreshing, unless it comes by way of admission from sources that appear knowledgeable but seldom are.
The refreshingly ignorant source I have in mind is today's New York Times (Sept. 4), which ran an article under this headline:
A Market Decline in Search of a Reason
"Stocks on Wall Street plunged on Thursday, but few investors seemed to know why" was the first sentence. The story explained how "other news of the day, including a $2.50 drop in the price of oil, would usually cheer investors," and then asked, "So what gives?"
And upon quoting a trader who had no answer, the article also said "The confusion was shared by several analysts who were watching stocks fall."
Please know that I'm not picking on the New York Times -- I really do think it's commendable for a news report to acknowledge that it has no news to report. It made other news sources seem all the more silly for trying to "explain" the stock market's decline.
Markets NEVER need a news-related "reason" to trend up or down -- if anything, today's stock market trend anticipates the type of broader news story you'll be reading tomorrow. This truth is lost on the vast majority of reporters and the public, who, in turn, go "in search of a reason" AFTER "a market decline."
Contrast all that with this simple sentence, which began Wednesday's Short Term Update:
"The evidence leans toward the view that wave 2 [up] topped on August 11 and wave 3 down is underway."
STU, Wednesday, September 3, 4:40 PM Eastern
Using the news to make financial decisions is like relying on the rear view mirror at a fork in the road. Investors who do so are doomed to react to events, instead of anticipating them.
Seek out and learn to use the tools of technical analysis, particularly pattern analysis. Become intimate with the market you put your money in: in time you'll understand its behavior and the "language" it speaks.
We can help. The September issue of the Elliott Wave Financial Forecast is online now, via a subscription to the Financial Forecast Service. That subscription also includes the Short Term Update I quoted above, complete with charts and a full explanation of our stock market forecast. Click here to learn more.