Well to be honest no one really knows! Not you, not I and not even one of the best traders on wall street connected to the bigger guys who manipulate things. We talked about this a few months ago here on the sentiment trader blog.
There is panic right now, because people are starting to think the market is too high and they are swearing on their mothers grave that things are so high, it cannot go any higher! Well, I seriously doubt that, and then there is THIS CHART BELOW.....
|when will the market crash again|
This is a NYSE margin debt chart people that is now circulating around the blogs, and its authors are saying it is not allowed to go higher? Really? again its only blindsiding people asking when will the market crash again
SO WHAT IS THIS CHART ?
In laymans terms it cannot show when will the market crash again, like I said no one knows the date or time of that one.
WHAT THIS CHART SHOWS IS : October 2013 NYSE margin debt stood at a new record high of $412.5b (up from $401.2b in September) and exceeded the prior high from April of $384.4b and net investor worth dropped to a record low. However, as BofAML notes, NYSE margin debt and the S&P 500 have +0.76 correlation using a 48-month (4-year) correlation as of October 2013. This is the highest correlation in our data history back to 1964. A positive correlation means that margin debt and the S&P 500 tend to move together; which as they helpfully note means - as long as the market rises, margin debt is not a risk.
So before you go and panic and think the market is about to crash here, you really need to find the true meaning of charts people are posting on forums and blogs around the place. This chart above is not the true representation of what is happening in the market right now, and only going to make people panic and do stupid things, and possibly lose them some money.
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