Market Participants are Extremely Bullish

With the current political upheaval in this country, it is difficult to see how the market can be so bullish. In today’s article by Elliott Wave International, we see that the market has “Great Expectations” for 2021. But as we saw in the previous article, Why Most Investors Miss Major Stock Market Turns,  often when market-participants are most bullish is at the peak. And its not just amateurs that make this mistake, even “professionals” get caught up in the euphoria. This makes sense in a strange sort of way. When everyone is “fully invested” there is no more money left to flow into the market so it has to go down. And when everyone has taken their money out of the market and put it in “safe cash” there is plenty of money available to drive the market up. Recently Forbes published an article entitled 4 Stock Market Sentiment Indicators: Euphoric-Plus. The old market adage “when everyone else is buying you should be selling” might apply here. Also at the end of this article, you can get free access to the online version (really free- no shipping) of the Elliott Wave Classic, Elliott Wave Principle: Key to Market Behavior  ~Tim McMahon, editor