I write so many articles these days that sometimes I forget all about them. Today when I was researching an article on Apple’s technicals, I remembered that I wrote an article about a bearish engulfing in Apple’s chart about a year ago. At the time, Apple was literally trading at its all-time high, and it seemed like the sky was the limit for the stock.
When I looked back today, I realized that I pegged the top in Apple’s chart to the very day.
If technical analysis seems like voodoo to you, I thought the same thing before I learned why it actually works. The charts are not predicting the market; the charts are simply a representation of what traders are thinking. But you have to understand how that market psychology works before you will ever be able to profit from technical analysis.
There’s an entire chapter on technical analysis and how it works in my book.
One more thing: the Apple top, as is the case with most market tops, came at a time when nobody was expecting it. If you have a belief that a stock is overpriced but you feel like an idiot for selling it because everyone else in the universe loves it, it probably means you’re doing something right. But you don’t have to take my word for it: Chart Of The Day: Bernstein Says Crowded Trades Underperform Less Crowded Trades.
As for me calling the Apple top, you don’t have to take my word for that one either: New Bearish Technical Signal In Apple’s Chart.
Finally, I don’t know anything else about you, but I know you were literally nothing before your mother straight up created you out of thin air. Do something nice for your mother this weekend.
Want to learn more about how to profit off the stock market? Or maybe you just want to be able to look sophisticated in front of your coworkers when they ask you what you are reading on your Kindle, and you’d prefer to tell them “Oh, I’m just reading a book about stock market analysis,” rather than the usual “Oh, I’m just looking at pics of my ex-girlfriend on Facebook.” For these reasons and more, check out my book, Beating Wall Street with Common Sense. I don’t have a degree in finance; I have a degree in neuroscience. You don’t have to predict what stocks will do if you can predict what traders will do and be one step ahead of them. I made a 400% return in the stock market over five years using only basic principles of psychology and common sense. Beating Wall Street with Common Sense is now available on Amazon, and tradingcommonsense.com is always available on your local internet!
