Investors use data to look forward. Taking a look forward with data can show repeating economic and market patterns. Seeing those patterns improves your odds of knowing near term market direction.
That so called predictive function can strongly suggest the most probable future which can be a tip off to either opportunity or danger. That can be a big money-maker or a capital saver!
Look ahead 6 months with 3 stock market guidelines
Market direction
This lesson 6, Monitor Markets to Protect Wealth course covers the data sources we can use. Links at the end guide you to related content if you want to learn more.
Occasionally deep analysis of data provides insight. However, much more often the many reports contribute to a patchwork. From that patchwork a complex economic picture emerges. Rarely is the picture clear.
The various reports can support, contradict or confirm one another. There is never complete agreement or data harmony. Typically the view forward is obscured, foggy and with significant contradictions. All efforts to assess and interpret current economic data are uncertain at best.
Investors use data to look forward and understand a continually changing picture
Most frequently our vision of the economic picture changes slowly. The outlook changes between bright, vibrant and positive to dull, gloomy and negative.
At times the transition can be sudden but much more often the changes happen gradually occur over periods of months or years. These changes in outlook happen because the data have changed. Investors use data to look forward so keeping in touch with the data keeps you in touch with market direction.
We do not want to spend any significant time invested on the wrong side of the market. That makes any change in direction a most critical point when tracking data.
So far no very reliable indicator of future trend changes has been identified. So I recommend following the guideline data as the key to know market direction.
Pulling together direction and tone investors use data
The way I put this together is to note the trend. By looking at the charts of the stock market indexes we can see that currently the trend is up. So the market is saying the economy will most likely be better in the next 6 months.
The improving economy and current market uptrend gives is confidence that the market will likely continue to rise in the weeks and months ahead.
There will be volatility. It could be choppy. But I expect that overall, it will be up.
The vast amount of data available can confuse rather than clarify and help. So we need something far simpler. In our next discussion we will discuss a much easier way to identify how investors use data to look forward and see the most likely market direction.
Share: Look forward with data
Buttons at the bottom of the page let you send this lesson to family and friends!
Subscribe free and get White Top Investor lessons in your inbox!
Make money work for you by knowing how investors think, feel and act. Learn here The Investor Mind.
White Top Investor website layout and organization: click here.
Course links to White Top Investor lessons.
You may also like these other lessons related to: Look forward with data
Winston Churchill saw opportunity in crisis
Ride tapering groupthink higher
5 Key finance checks
Attached stubborn helpless investor
Selling low melts wealth
Investment impatience destroys wealth
Income, value and growth investing
5 Key finance checks
Comments and questions welcome
Email me at [email protected].
Make money work for you
Use White Top Investor lessons to learn investing. By doing that you can grow into a knowledgeable, comfortable and confident investor. To learn how, you can learn investing one small step at a time at your own pace. Do that and become the master of your financial security and independence. White top Investor never sells or shares our email list. Learn more.
Monitor Markets to Protect Wealth:
Introduction to Monitor Markets to Protect Wealth Lesson 1
4 Indicators muffle noise Lesson 2
4 Market direction drivers Lesson 3
Daily buyer-seller battles Lesson 4
3 Risk or opportunity signals Lesson 5
Look forward with data Lesson 6
5 Star market compass Lesson 7
Check market direction trends Lesson 8
Headline news market risks Lesson 9
Next lesson 7: 5 Star market compass
Have a prosperous investor day!
Bryan
White Top Investor
[email protected] WhiteTopInvestor.com
Let’s connect, follow me; Twitter LinkedIn Facebook
Image courtesy FreeDigitalPhotos.net
© 2013-19 Bryan Kelly
