This is what the market makers have alway done! via /r/wallstreetbets #stocks #wallstreetbets #investing


This is what the market makers have alway done!

From the book "Volume Price Analysis" by Anna Coulling, p. 48-49. A really good book by the way. The book is based on Wykoffs understanding of the stock market, aswell as Coullings extensive experience in the stock market.

"Before moving on to consider the selling climax and the buying climax, at this point in the book I think it's appropriate to answer a couple of questions which sometimes puzzles both traders and investors.

The first question is – why do markets take longer to rise than to fall, and is this something to do with the insiders? The second question is – over what time frames do these cycles of filling and emptying the warehouse typically last?

Let me answer the first, which also leads into the second.

Market insiders only have two objectives.

The first is make us fearful and the second is to make us greedy. They have no purpose in life, other than to create emotional responses which will ensure that we always do the wrong thing at the wrong time, but they always do the right thing at the right time.

A quote from the late great John Templeton who wrote: “Heed the words of the great pioneer of stock analysis Benjamin Graham: ‘Buy when most people…including experts…are pessimistic, and sell when they are actively optimistic.’”

Let's think about this logically and try to answer the first question.

The markets have been in free fall, with panic selling by investors and traders.

Then comes a period of calm as the market moves sideways into the accumulation phase, as the warehouses are stocked up ready for the move higher.

Now at this stage, remember, that from an insiders point of view, they have just frightened everyone to death, and the last thing they want to do, is to suddenly send the market soaring in the opposite direction. This would soon drive every investor and speculator away.

After all, there is only so much emotion that traders can take, and too much too soon would quickly kill the goose that lays the golden egg.

A calm approach is required.

The tactic now is to quietly start to build confidence back up, moving prices higher steadily, without frightening anyone out of the market, and gradually drawing the buyers back in.

Soon, the panic selling is forgotten as the markets recover and confidence is slowly restored. This also suits the insiders, as they have a full inventory to sell, and want to take their time, and certainly don't want to see large volume buying as they move the market higher.

At this stage, it is is about maximising profits, and the biggest profits are to be made once the distribution target price levels are reached at the retail level.

It would be madness to suddenly mark up the market to the retail level, as many investors would then feel they had missed out on the move, and not join in later. "

BUY-HODL-DRS

See ya on the moon, you degenerates.

Submitted January 17, 2022 at 09:20AM by alexhogset
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