SIX STEPS and the IRREFUTABLE LAWS of the MARKET Every Investor and Trader MUST KNOW to Succeed.
Step 1:
A move begins with the sponsors (smart traders) who have insider
knowledge as it relates to a particular stock or market. This
information will move a market up or down depending on the insiders'
information. These buyers are smart, very smart, and recognize
trading/investment opportunities very early in the markup cycle.
Step 2:
Days, weeks, or sometimes months after a move has started, there is a
brief mention in the electronic media (radio, cable, TV) or on one of
the internet chat boards that a market has moved. The public hears for
the first time and begins to get interested, but does not buy.
Step 3:
A blurb of information appears in print media. The move also begins
getting more exposure on blogs and internet message boards. The public
starts paying a little more attention, and will buy a little bit.
Step 4:
Wall Street and LaSalle Street brokers go into full hype mode and hawk
the market to their customers. The public begins buying in greater
volume.
Step 5:
A full-blown front-page article appears about the particular stock or
market in one of the major financial newspapers, magazines, or
financial websites. This is often six months after the fact and after a
market has shown its greatest appreciation. There is often heavy public
buying, even a possible frenzy, as all media, brokers, and so-called
"gurus" start to tout the market.
Step 6:
As step 5 gets underway, the sponsors or smart traders begin to move out of the market and take their profits off the table.
The finale: The move ends, the market falls, and investors lose money.
