Talk About on the Fence

This is an excerpt from an investment newsletter that I have no idea how I ended up with, I don't read other's analysis because I don't want to influence my own, but after the first few paragraphs, it's clear to me why people keep losing money with these services. Here's the start of it,

"It’s a tough call to predict the markets’ direction in the week ahead. XYZ Analysis can make a case that stocks are oversold, and just as easily make the case that stocks are not low enough.

Looking at index charts, they look less than attractive. This is when a bounce usually occurs. We see the indexes trading below their 50 day-moving-averages, the short-term averages crossing below their longer-term cousins and everyone and their cousins see the same thing-where's the edge?, the MACD lines pointing straight down… and yet, according to Bollinger Bands, the Dow, NASDAQ and S&P are nearing oversold levels." There truly is no such thing as oversold, not that's useful. One of my best performing systems only buys overbought stocks and sells short oversold stocks. Their reliance on moving averages, MACD and Bollinger Bands ansures that they don't see anything unique, the rest of the market is all looking at the same things, thus the herd/sheep mentality that gets led to the slaughter.

It's not fun for me to rip someone else's analysis, I just want to show you how pervasive the status quo is and why investors and traders lose over and over again. This particular letter's first sentence was to hedge their analysis. Of course you want to be prepared for anything as the market can throw anything at you, but this was like it's partly cloudy and whether it rains or doesn't, their still right. However, it doesn't do much to help their readers.