Market patterns repeat repeat repeat for astute investors using knowledge of repeating patterns to make money. Repeating patterns can show the mind of the market.
Wealth Building Portfolio Management, lesson 5 discusses chart patterns that track stock market prices have repeating patterns that investors can use to seek profit. Links at the end guide you to related content if you want to learn more.
What’s in this lesson for me?
This lesson gives you an understanding of an analytical tool available to investors. Repeating chart patterns can show investors profit making opportunities. Becoming familiar and comfortable with chart patterns can help inform investors of stock market possibilities.
Market patterns repeat repeat repeat
Charts tracking stock and market prices show repeating patterns. Using those patterns to track trading information opens windows on human trading behavior. In part it reflects group dynamics as well as the wisdom and the madness of crowds.
Market and stock patterns show again and again. Nothing new happens in the patterns of stock market trading or stock speculation. Market patterns repeat for investors. The patterns have been known for centuries. They serve as windows into the mind of the market. Stock charts track the patterns.
In those patterns we can see human groupthink as well as both the wisdom and madness of crowds. Understanding the patterns provide knowledgeable investors with profit making opportunities.
In stock markets as well as the work of any profession, a daily commute or during a sports contest, movement patterns repeat. The common element of human emotion drives that behavior. Human nature and behavior time and again repeat the same patterns.
Market patterns repeat for investors and emotions drive it!
Emotions are at the core human nature and behavior. Emotions can always get in the way of human intelligence. We can regularly see this in the displays of panic buying and panic selling in all stock markets.
We can use this knowledge both to make money and to avoid loss.
No one wants to admit to a panic sale that cost money or an overly anxious buy that resulted in paying too much. Daily market action consistently displays such behavior.
Some patterns such as tides of oceans are known and predictable. When beach combing locally at low tide I know the next tide will arrive in about 6 hours and 10 minutes.
Those 6 plus hours are the typical period between tides around the world. In the markets the pattern and rhythm is not nearly as predictable or exact as pattern followed by the moon which causes tides.
Emotions tied to greed, fear, ignorance and hope powerfully drive much market action. Those forces apply to all. That includes newcomers and veteran traders. Human emotions show in the patterns displayed on stock market charts.
Accept it, learn it and profit, market patterns repeat for investors
Market patterns repeat for investors. By learning the patterns of stock market charts you access useful data. That can give you insight. That advantage can let you successfully and substantially add to your pile of coins.
The patterns repeat again and again. But, of course, there is always a but. The big but is that exact pattern repetition rarely occurs.
Chart patterns can inform. However, be careful. Getting too fine in analysis or expectation can produce bad or simply grossly inaccurate data.
Number crunching can produce junk. Especially when the numbers are thin or trying to extract data where none exists. That can lead to expensive trading mistakes.
And that can also be a major rub. Especially if aggressive action gets taken based on “knowing” what comes next.
Like the player in any sport caught well out of a normal position. If the opponent gets beat by the bold move, you can be a hero when your prediction is correct. Or the foolish booed when the opponent takes advantage and turn the tables. You took a chance and lost!
When investing, aggressively anticipating a market or stock move gets very expensive when you are wrong. Probability or possibility is not certain. Like weather forecasting, knowing, studying and analyzing provides valuable information. But not certainty.
Human nature will not change
We know and accept that human nature does not change. But trading patterns do not exactly repeat. They vary. Especially through nuanced pattern changes that are constantly part of the daily trading mix.
If patterns repeated exactly and precisely the army of programmers that have so far tried, would have mapped human behavior. Coders have pounded out millions of algorithms but so far have not nailed it.
All our variable responses and constantly changing influences that impact behavior have not been reduced to code. Someday perhaps, but I am not holding my breath just yet.
Slight or great, market patterns repeat repeat repeat
At times the variations in stock market charts are slight. Other times they are substantially different. Still the basic patterns do recur again and again. There is both opportunity and risk there.
So exercise caution. Using the tools can produce information. That points to probability or possibility. That can benefit you. Just know this is not a prediction. Far too many newcomers discover the holy grail of chart analysis only to suffer devastating losses.
Charts and patterns can not build a portfolio anymore than the best set of tools can build a house. With effort and time the chart reading skill grows. Apply with caution.
Regard charts as tools, nothing more. Learning to use them gives you an advantage and information. They do not give the absolute answer. They do not predict the future.
Why this lesson matters
This lesson brings investor attention to a useful analytical tool. Repeating chart patterns can show profit making opportunities. Investors that becoming familiar and comfortable with chart patterns can recognize more stock market opportunities.
Key take away points from lesson 5,
Market patterns repeat repeat repeat:
Market patterns repeat repeat repeat for astute investors using knowledge of repeating patterns to make money. Repeating patterns can show the mind of the market.
- Stock charts are useful analytical tools for investors.
- Patterns on stock charts repeat.
- Short term price gyrations display investor emotions.
- Market panics and anxiety shows in stock chart patterns.
- Unchanging human nature continually shows up on stock charts.
Share:
Market patterns repeat repeat repeat
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 lessons, website layout and organization: click here.
You may also like these other lessons related to: Market patterns repeat repeat repeat
Ride tapering groupthink higher
Investment impatience destroys wealth
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.
Wealth Building Portfolio Management lessons:
Introduction to portfolio management Lesson 1
Pyramid portfolio wealth building Lesson 2
How investors buy dips Lesson 3
Distracted investing misses profits Lesson 4
Investors never average down Lesson 5
Market patterns repeat repeat repeat Lesson 6
Research confirms investment counts matter Lesson 7
Portfolio measurements to size positions Lesson 8
Growth protects investing profits Lesson 9
Winston Churchill said crisis = opportunity Lesson 10
Weeding your investment portfolio Lesson 11
Next lesson 7:
Research confirms investment counts matter
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
Copyright © 2013-19 Bryan Kelly
WhiteTopInvestor.com
