Investors always find ways to "rationalize" bearish or bullish stances
For a stock market investor who understands that markets are not random or chaotic but instead
patterned, the most important information to know is the
price pattern of the market in question.
For an Elliott wave investor, the task is even more defined. As Frost & Prechter's Wall Street classic book,
Elliott Wave Principle, says:
waves. Waves are patterns of directional movement.
So, familiarity with the Elliott wave model for forecasting financial markets is a
must.
Another key factor in analyzing the stock market is sentiment. The reason why is because when bullish or bearish sentiment reaches an extreme, financial history shows that a "tipping point" -- in the opposite direction -- is usually just around the corner.