Many of your questions will be answered if you view the current situation from Market Cycle analysis perspective. Market has many cycles effective at any moment. When big wave/cycle is going up, any downmove of the smaller cycle will get supported by big cycle and hence those falls will be limited in size.
At the same time, any upmove of small wave will get extra push from big wave and will get extended.
Exact reverse happens when the big wave is going down. That is why you can't compare current mkt situation to 2006/07 when bigger wave was going up.
These market cycles are dependent on factors from economy and we are in really bad economical shape. IMO, we can get idea about such market cycles from history but I will discount that too.. because current global economy is very different. We did not have derivatives and other advance intermaket instruments back then in 1929, 1987 etc.
Global markets were not so smoothly connected like they are today.. and we never had fund managers sitting in US / UK playing the significant part of daily marketcap of Indian, Japanese, Asian market like they are doing today.
So, IMO, bigger picture is still bearish.. From trading perspective, it makes no difference to me because I can find trades as per my system. Of course, many people don't have system to play in bearish market so they find it difficult to trade bearish market. I don't care how low the market is going to go.. because I will be in or out of my trade based on the signal given by system. So if market has stopped going down, the charts will tell me that. No hurry and Enjoy the ride.
Happy Trading
At the same time, any upmove of small wave will get extra push from big wave and will get extended.
Exact reverse happens when the big wave is going down. That is why you can't compare current mkt situation to 2006/07 when bigger wave was going up.
These market cycles are dependent on factors from economy and we are in really bad economical shape. IMO, we can get idea about such market cycles from history but I will discount that too.. because current global economy is very different. We did not have derivatives and other advance intermaket instruments back then in 1929, 1987 etc.
Global markets were not so smoothly connected like they are today.. and we never had fund managers sitting in US / UK playing the significant part of daily marketcap of Indian, Japanese, Asian market like they are doing today.
So, IMO, bigger picture is still bearish.. From trading perspective, it makes no difference to me because I can find trades as per my system. Of course, many people don't have system to play in bearish market so they find it difficult to trade bearish market. I don't care how low the market is going to go.. because I will be in or out of my trade based on the signal given by system. So if market has stopped going down, the charts will tell me that. No hurry and Enjoy the ride.
Happy Trading