FYI: “The pieces have fallen into place for a significant intermediate-term bottom.” So argues Hayes Martin, President of Market Extremes, an investment consulting firm that focuses on major market turning points. Over this past weekend, he told me that “an upside explosion could occur at any time.”
To be sure, Wall Street’s cemeteries are filled with the graves of past market analysts who tried, and ultimately failed, to consistently identify market tops and bottoms in real time. One big hurdle that analysts face is statistical: The number of past tops and bottoms is relatively small, and many of the indicators on which we rely today didn’t exist in the past — and vice versa. Moreover, lots of data points are needed to reach conclusions that satisfy traditional tests of statistical significance.
Yet over the several years I have been tracking him, Martin has impressively identified periods of higher- and lower risk and, what’s more, when risk was high he did a creditable job forecasting the extent of downside risk. He says that he employs several statistical techniques which at least partially overcome the statistical hurdle created by a small sample.
Regards,
Ted
https://www.marketwatch.com/story/these-two-trading-patterns-could-trigger-the-long-awaited-stock-market-melt-up-2018-04-10/print
