I recently received several newsletter emails from friends who shared different points of view about the markets. Opinions vary quite often as we see things for what we want them to be rather than for what they really are. Of the seven emails I received, three of them were bearish, two of them were waiting (hoping?) to be bearish, one was noncommittal and the other was bullish.
Now, seven is a pretty small sample size to make an assessment of market sentiment. And frankly, one of them is bound to be right. But what I find interesting is the wide dispersion of opinions and the strong conviction behind them. There is no doubt in these writers' minds about the next phase of the market -- whether it's up, down or sideways.
Like a broken clock that is right twice a day, they're bound to be correct at some point. Remember, though, our job is to make money, not to be right all the time. Further, timing the market consistently for long periods is a fallacy.
What matters most is understanding what you're reading. Is it just propaganda or entertainment? Will these prognosticators brag until the cows come home if they turn out to be correct? Probably so. The funny thing is, you really don't need anyone to give you direction or instructions. The market always will tell you everything you need to know about the current condition at a point in time.
Those who have learned the art of chart reading understand the technicals always tell the story. More experienced technicians look for trends and patterns that repeat over and over again, using high probability analysis techniques to further their conviction.
No approach is 100% perfect, but as a technician I feel more comfortable building a case with strong evidence instead of blindly following a guess based on criteria I might not understand. We've all heard the story of the Pied Piper (by definition, one who offers strong but delusive enticement) and how he led others down the wrong path.
Don't let that happen to you.