Confirmation bias has cost the average investor thousands upon thousands of dollars in the stock market.
This psychological phenomenon in which we have a tendency to search for information that will confirm our preconceptions is actually the most dangerous thing on Wall Street.
And right now confirmation bias is causing the swarm of bulls to become overly greedy. That means it’s the perfect time for you to be fearful of this…
From February 12 to February 22, the stock market hit a 6-day surge that took it from 15% below its record high back to a high for 2016 if you don’t count for the first few trading days of the year.
And that little recovery has immediately sent everyone from panic mode straight into relief mode.
Now, it appears that people are once again getting greedy. And as Warren Buffett says, “be fearful when others are greedy.”
That’s perfect advice right now, most notably because people are using this surge to mask the reality of the situation.
Here’s why you should still be fearful…
1. Even if you want to consider us to still be in a bull market until levels drop to 20% recent highs, it’s an increasingly old bull market that’s overdue to pass.
2. Oil is still at shockingly low prices, with oversupply dragging it down.
3. China is still struggling mightily.
4. Debt defaults are now beginning to spiral out of control, with resource exporters like Brazil having been beaten down to the point of semi-bankruptcy.
5. The emerging markets are being hit hard.
6. The global economy as a whole appears to be slipping into recession. In fact, the U.S. market seems to be the only thing holding it up. But how long can it last while being weighed down by everything else?
There are many more reasons to be fearful than greedy, so why is everyone shouting, “Bull! Bull!”
It’s because most people don’t realize that you can make huge money by betting against the market. And that’s what readers of Code Breaker find out, even if they don’t have any stock market experience at all…
