If you found this post valuable please support me.#MarketWatch Major indexes start new year of trading lower as concern over China's economic slowdown spooks Wall Street
— Greta Wall (@GretaLWall) January 2, 2019
That's Now How It Works
But that's now how it works...it's not how any of this works. I don't say that to pick on Greta or anyone else. Human beings are problem solvers and seek the root cause of events. We're naturally curious, walking, talking, pattern-recognition devices. Unfortunately, we get our wires crossed all the time.
Stocks Went Up (or Down) Because of X
It's commonplace to read financial news -- whether about stocks, bonds, commodities, cryptocurrencies, etc. -- that states with seemingly absolute certainty the root cause of every rise or fall of the markets. Markets consists of thousands of stocks and millions of investors from around the world. How can the financial media possibly know why an entire market moved? They can't, but they report their reasons as if they were facts. They aren't.
Why Do Markets Move
In a very general way here are three reasons markets move:
- Capital Flows - Martin Armstrong has written extensively on this topic at his site.
- Confidence - Again, Armstrong has covered this in his Economic Confidence Model or ECM.
- Numbers/Cycles - Numbers and Cycles are part of the fabric and pattern of the Universe. If you view numbers as a programming language controlling events instead of a means of measuring phenomena, you'll progress much more rapidly toward a better understanding of the mechanism that moves markets.
Daily Stock Market Projections and More
I'm still getting in the groove of writing these posts. However, if you're just looking for daily projections of which way the DJIA, SPX, and NASDAQ (IXIJ) will move on a daily (also monthly or yearly) basis, then please follow me on Twitter where I Tweet about these topics and much more.
Cause and Effect
Just as a teaser, consider cause and effect in markets. Media and alternative media often tend to sensationalize financial news for clicks. We're told that markets move purely based on manipulation, are saved by the Plunge Protection Team, are bound to crash because of the Fed and on and on and on. We're led to believe that market numbers (price, levels of DJIA, SPX, IXIC, etc.) flow from events. What if that isn't true. As a thought experiment, what if the opposite is true? What if events flow from the numbers? What if numbers are the programming language of the Universe?
Is That How it Works?
On this site, we're on a journey to discover just how the numbers work. This is deeply intertwined with the shape and formation of the Universe. It goes in some pretty strange directions like the proof of Fermat's Last Theorem. What will, hopefully, set this set apart (and the Twitter feed listed above) is that the projections flow from the ideas that will be outlined here. These ideas will be tested over and over and over again. You can judge for yourself whether or not you believe the ideas as well as whether the results that flow out of them are valid. By the end, you should be able to determine whether you prefer the financial media analysis pointing to single causes for market movements, or something that may appear bewilderingly complex at first glance, but ultimately seeks to get to the heart of what is moving the markets daily, monthly, yearly and beyond.
