It was just last night in my "A Currency Crisis" Post that I said these EXACT words...
"Even though SPX prices are higher now, people can rarely separate price action from the clear signs of trouble; I have seen 2 months of upside price gains wiped out in a single day or gap down so these are very dangerous times to be long the market, yet people who read the headlines, "S&P makes all time new high", can rarely see any further than the headline. When the reckoning comes, they stand to lose a greater sum so fast that there's nothing they can do about it, yet the warnings were there the entire time for those who were attentive."
And today alone...
"When we look back a year from now, this area will be the area recognized as the point in which the back of the trend was broken".
Just looking at last week, today wiped out almost the entire week's gains, there are 21 days of gains that have been wiped out today alone (anything above the red trendline).
I just think this is a good time to remember all of the warning signs and being able to separate short term emotions and headlines in the newspapers and on CNBC about 'All time new highs" and the real facts, the charts flashing red flags, the breadth charts, etc.
The fact is, fear is a stronger emotion than greed. The 2002/2003-2007 bull market saw all of its gains and then some erased in 16 months (after 60 months of moving up) and most of that happened in 8 months. You might be saying, "We'll not if you sold!". That's the problem though, people make money, they believe in the F_E_D and they think that it will come back and they hold and sometimes the market gives them encouragement to believe what they did was right just to lock them in.
There's a sort of parable I like, "A captain in the Army comes across a minefield and decides the best way to cross it is to just close his eyes and walk across, now in that Captain's mind, whenever he comes to a minefield he believes the proper way to deal with it is just to close his eyes and walk across"
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