Social Mood Directs the Stock Market and More

Mainstream media always find a reason to explain why stocks go down or go up. For example:

http://www.marketwatch.com/story/stocks-edge-higher-at-open-2010-06-22

But study of the underlying market action suggests news do not drive the stock market:

http://www.tradingstocks.net/html/news_do_not_move_stocks.html

Everyday there are good news and there are bad news. Media chooses the headline based on how the stock market reacts. Earnings do not rive the stocks. Good earnings appear at the top. Earnings decline AFTER the market:

http://www.tradingstocks.net/html/earnings_drive_stocks.html

Social mood drives the markets. A bull market is the result of optimistic social mood. A bear market comes when the social mood declines.

http://www.tradingstocks.net/html/socionomics.html

Good news appear at the top of the market. Bad news appear at the bottom. Good earnings come at the top. Bad earnings come at the bottom. This is why one cannot trade based on news and earnings. This is why in the middle of bad news back in March 2009 we started the rally. Even though the news may be good, we can top any time and start a stock decline. And recession would be announced later well into the decline.

Back in March 2009, sentiment was 3% bulls. A year later after the rally has already happened bulls are 92%. These extremes appear at market tops and bottoms. This is how the crowd gets it wrong on turning points. Big money has been selling for weeks now:

http://www.tradingstocks.net/html/latest_opinion.html

Meanwhile, the macro economic picture is deteriorating fast. Public and private debt is too high. The conditions are primed for a repeat of Great Depression, only bigger and worse:

http://www.tradingstocks.net/html/prepare_for_market_crash.html