Sentiment cycle. Two sentiments and FUD.
Based on Livermores "opposite day trading", Qullamaggies 10/20/50.
Livermores emotion cycle doesn't fully explain price dynamic. In practice markets or crowd have a clear sentiment of "safety" and trust. and "danger" and distrust.
You can have a strong market... that breaks and starts crashing --> You know the sentiment wont be the same. You see some risk taking fomo.. but it doesnt end nowhere. Because the core of every strong market is strong momentum technicals or setup. Odds in your favor etc.
It's very clear where the SENTIMENT (cycle) shifts to crashing and "it wont be the same anymore". towards risk on (setup).
Categorizing all market on RISK-ON, RISK-OFF (at near term) wouldnt explain the dynamic either... because like most of the time (maybe 80%) market is on a FUD mode.
Livermore was good at explaining crowd temperature.
Something could be bullish, but still on FUD mode -> and you get these tiny sell offs, losing due to SL or selling on fear.
clear "RISK ON" is where, based on Qullamaggie, there are strong upsloping quick MAs (10/20/50). --> best explanation would be that people trust in the market. It's hard to lose, when everyone throws money at market.
eventually it leads to FUD channels etc. or corrections.
Even today --> there do always be some chance, that market just crashes. No guarantees. Strong technicals but FUD sentiment.
//April, May, June were all FUD.. fear uncertainty doubt.
Livermore said there was only two emotions, Fear and Greed.
Livermores emotion cycle doesn't fully explain price dynamic. In practice markets or crowd have a clear sentiment of "safety" and trust. and "danger" and distrust.
You can have a strong market... that breaks and starts crashing --> You know the sentiment wont be the same. You see some risk taking fomo.. but it doesnt end nowhere. Because the core of every strong market is strong momentum technicals or setup. Odds in your favor etc.
It's very clear where the SENTIMENT (cycle) shifts to crashing and "it wont be the same anymore". towards risk on (setup).
Categorizing all market on RISK-ON, RISK-OFF (at near term) wouldnt explain the dynamic either... because like most of the time (maybe 80%) market is on a FUD mode.
Livermore was good at explaining crowd temperature.
Something could be bullish, but still on FUD mode -> and you get these tiny sell offs, losing due to SL or selling on fear.
clear "RISK ON" is where, based on Qullamaggie, there are strong upsloping quick MAs (10/20/50). --> best explanation would be that people trust in the market. It's hard to lose, when everyone throws money at market.
eventually it leads to FUD channels etc. or corrections.
Even today --> there do always be some chance, that market just crashes. No guarantees. Strong technicals but FUD sentiment.
//April, May, June were all FUD.. fear uncertainty doubt.
Livermore said there was only two emotions, Fear and Greed.
Catatan
"if something goes that direction, PROBABLY it also will finish xxxx".
last time with decent BTC setup, me and probably everyone else had a FUD. Dont want to ruin your mood. Consciousness of how easy for a trend to break and turn into risk off. But probably EVERYONE thinks the same.
if something goes that direction, it will probably also have a positive end result.
I think Qullamaggie was perfect at explaining how the MAs just work and have been working in the past 100 years.
//Markets (crowd) waits.. maybe another day... lets see what happens.. the price takes off lmao.
//Same with gold price at last channel. 6X returns in a month.
Catatan
Qullamaggie was also good at explaining how there are rare "home runs" that you MUST focus on. Most of time, you are grinding. Before the home runs appear. Where the big money is made. I never thought in that way. lolCatatan
here's one for NVDA during it's AI rally.
-> easy to make money during RISK ON phases. (momentum). Stupid if you are FUD and sell early. Qullamaggie says, that's basically where the home run, big money is.
-> FUD, where you can lose money. and markets can scare you off?!
-> note a correction isn't RISK OFF. because everybody knows it will rally. Correction is EXTRA BULLISH. and it f-ing was. 80%.
-> RISK OFF is where everything changes. sentiment goes on "back to climbing wall of worry. no trust".
It falls to "oblivion". and wouldnt rally right to ATH.
It took like, what, 3 months before another R-ON emerged?
whole side ways market a big FUD?
Catatan
Recent BTC struggle proves the point of this theory. How we are on a sentimental "risk off" or FUD. meaning no easy %s. Catatan
fact check with VIX. (as VIX is the best risk-on, risk-off indicator?)
-> break of a VIX structure usually good indicator for risk on or off?
sometimes LOW VIX + 10/20/50 swings could indicate beginning of a "risk off" sentiment? ie loss of trust.
-> low VIX or VIX in a pattern could be a sign of "FUD" period? it also make sense, people worrying.
--> VIX HLOW structure very good indicator for "risk on".
//also just because 10/20/50 rallying, doesnt mean it's "risk off". Just a correction or FUD. Corrections are MEGA bullish during "risk on". hmm.
Catatan
"as VIX is the best risk-on, risk-off indicator?"-----> true and false. You got to look in the context.
Low vix doesnt mean market top, or correction. But it could mean a FUD period. Sometimes VIX pattern is more important than simply low vix.
Low VIX, with swingy 10/20/50 potential, could mean corrections?
If market tops, they just correlate.
I think break of a structure, with swingy 10/20/50 has higher chance for top.
High VIX, lower significant H.LOW -> high probability for stock market bottom and new risk on phase. It fuels stocks very quickly. (Not sure if that's an universal rule).
Bottom line: dont sell stocks because low vix. because every correction is mega bullish in long run. VIX making patterns and breaking out- different story.
Catatan
if you combine ratsche macd with qullamaggies 10/20/50 concepts, ie.
(1) 100% market, with 1-2 month correction + (2) sloping 10/20/50, 10DMA supports. 10% daily.
with; (1) Weekly MACD supporting over zero. (2) daily MACD Supporting over zero. ie has potential.
seem pretty unstoppable strategy, with clear logical reasoning.
Catatan
sentiment cycle seem to explain peoples biases, your own mentality and how you should think about something. Catatan
"Losing BIAS" -- if you have history of losing when taking risks at lows, ie losing trust. When settups are good - you might not want to risk due to fear of losing. ie you are biased.Catatan
general theory says markets have fear cycle and greed cycle. That's misleading. (On context that do be risk on and risk off cycle?)
during these FUD episodes, there's both fear and greed. Price falls due to justified FEARS of a market crash, or market top. Fearful thoughts take over. Before it reverses and shows strength and there's greed. A typical "losing player" sells and then buys back. Before it repeats again, fall and then rally. lol
that's why there is no fear or greed cycle. During FUD, there's both. What you feel, is what everyone feels or thinks.
Trade aktif
here would be typical FUD. despite loss of momentum (lower low base + Bad sloping 10/20/50).
bullish today, shakes you out tomorrow. Careful.
Catatan
"Risk on" when it's easy. "Risk off" when some people chase the trend, but tomorrow on average is red.
FUD, no easy %. Uptrend.
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