Is the market manipulated?

[contra]

Quote from Maverick74:

But back to the topic at hand, no one here has been able to explain to me why technical analysis is suddenly going to stop working because of the fed. I guess I'll keep waiting.

Don't hold your breath on that.

I think TA might be more powerful these days.

I also think it helps to grasp the fundamentals, what's being traded on/into... with an idea of positioning if you can find a way to get that info or just have a general idea.

For people that are manually trading, I am not sure of any other way.

 

[Trader.Fighter]

Quote from Maverick74:

Of course nor did I state that. I simply said that IF a market truly is manipulated and in one direction, then the technical signals will be much easier to decipher then if it wasn't. Now whether Johnny trader can trade his way out of paper bag is a whole other issue entirely.

I was mainly clarifying my believe of manipulation and agreeing with you.

 

[Spectre2007]

If the FED decides to covertly stimulate the economy, how could they do it?..

How about funneling money into indexes, index ETF's.. index futures. By this alone paper wealth of immense proportions is created and its used to drive real world events/purchases.

The FED has to appear rationale, meaning they cant say the economy is doing bad, if they want the populace to believe otherwise. And if they say the economy is doing well, they cant keep interest rates down too long, they can decrease the slope of increase but not its direction.

So all they are left with to support the economy, is funnel money into pension funds, so the scared consumer is not scared but confident now.

 

[Ash1972]

Quote from Maverick74:

I'm as anti-fed as anyone but people are not going crazy for stocks. I hate to break this to you, but only in the last few months did we take out the highs we had in 1998, yes 1998!!!! That's 15 years ago. Yes I agree the fed has taken the volatility out of the market. And yes, the Fed has created all sorts of distortions in the credit markets. But back to the topic at hand, no one here has been able to explain to me why technical analysis is suddenly going to stop working because of the fed. I guess I'll keep waiting.

Do you agree there was an investment mania in 2007? The 2007 market top was only slightly higher than the 2000 high, 7 1/2 years previously.

 

[bighog]

TA is what it is, the best answer about dealing with TA is first understanding it, you decide if you are included in that group.

Now back to so called, manipulation from the fed. Well boys and girls, let me help you understand something. The federal reserve had no intention to ""manipulate" anything. The fed was handed an economy that was on the verge of total collapse from who else but the bad boys/girls that created/peddled worthless junk to unsuspecting fools. Bankers of all stripes have an innate style that causes implosions on a regular timetable of something like once a decade. The relaxed regulations and turning a blind eye to fraud allowed refilling of the punchbowl with ever more toxic ingredients just juiced the bad players to no end. The end only showed up when wall street ran out of new fools and had to shove the most toxic unsalable leftovers in that god-forsaken bottom drawer.

Enter the fed. the economy was not only entering a dandy of a recession but also the worst of all worlds, DEFLATION. Think of Ben as the opposite of Paul. Paul raised rates to kill the cycle of inflation, raised short term rates higher than the short skirts of the time. (sweet memories). Ben had the reverse job that Paul had, Ben had no choice but to lower rates to CREATE some inflation. Inflation is a deflation killer, thus the work of the fed is easily explained.

Look, forget reasons.............just trade what the mkt throws your way. Our president and the fed are drawing straws to get all back on track as best they can, do not forget, this was all new to them. The normal business cycle was blown away when the system could no longer run on BS credit created from cotton candy.

Rates will rise again when conditions warrant, not before. Never forget MARKETS overshoot at the top and also at the bottom. Your job is to milk it for all you can and do lose sleep worrying what politicians are doing. Last night I dreamed of getting laid...........all is still good...

Correction: dreamed that I WAS getting laid........HUGE difference ..

 

[learner2007]

Based on Dow Theory, TA was expanded around 1930 to apply to individual stocks with one of the main purposes being to detect manipulation.

Where I trade, manipulation was the name of the game in the 70's and 80's. TA sure helped me make a few bucks back then!
And today too, manipulation or not!

 

[Ash1972]

There is virtually no inflation (or investment) in the real economy, but instead an enormous asset bubble. That's where the cash has gone. Nice work, Ben.

 

[Tsing Tao]

Quote from Ash1972:

There is virtually no inflation (or investment) in the real economy, but instead an enormous asset bubble. That's where the cash has gone. Nice work, Ben.

The Bearded Blunder.

 

[Maverick74]

Quote from Ash1972:

Do you agree there was an investment mania in 2007? The 2007 market top was only slightly higher than the 2000 high, 7 1/2 years previously.

No, I disagree. The mania was in real estate and in the credit markets, NOT the stock market. Trust me capadre, I had friends become multi-millionaires flipping houses MUCH faster then my daytrading friends from the late 90's stock boom. At one point, a good friend of mine with only a high school education and 4 years in the Navy owned 26 properties with no discernible net worth. He never owned a single share of stock.

All the stock market did in 2007 was re-test the highs from 2000 and 1998. Bubbles don't re-test old levels, bubbles set levels. I understand that every Johnny come daytrader who was trying to short the market felt like it was a bubble, but bubble it was not. The bubble was in credit.

You had banks selling billions in synthetic teeny options on mortgage debt with leverage. And you had not one, but two Fed Chairman saying housing prices never go down. Some of you guys need to have more perspective on things.

By no means am I letting the Fed off the hook. I agree all these bubbles would not exist without the Fed. But the last stock bubble we had was the late 90's. Not 2007, not today. Today our current bubble is in debt. That will pop too. You may want to shift your focus from stocks to bonds. There is a bigger world to trade out there. Bonds have been dropping like a rock.

 

[kinggyppo]

Quote from Maverick74:

Come again? Technical analysis is about spotting the big buyers and sellers. No matter who they are. If I know a market is manipulated, the knowledge that gives me is that there is likely to be sustained moves in both directions. These are very tradeable and very easily found with any type of TA. I don't understand what you would need a different perspective if you knew the market was manipulated. That doesn't make any sense to me.

Smart players know what they don't know, gotta be careful throwing I KNOW around. How many times does someone watch a stock go up and say I knew that was gonna happen. Bias right, what's a fair bet, most would argue that the market is rigged because I am not successful at it, by that metric professional sports, being a doctor etc is rigged. I think we want to impose our own will on the world so why would the market be any different. I hear that something is rigged alot. I think that many things are difficult in life, doesn't mean they are rigged so much as proper understanding. Silva was the favorite to beat Wiedman in the UFC, Silva lost, therefore I lost my bet so it had to be rigged. Its all about how you see the world really. .02