Every investor and trader needs to know these six steps and the unbreakable rules of the market in order to be successful.
Step 1:
A move starts with the sponsors, who are smart traders with inside information about a stock or market. Depending on what the insiders know, this information will move the market up or down. These buyers are smart, very smart, and can see trading and investment opportunities very early in the markup cycle.
Step 2:
After a move has started, it might be mentioned briefly on the radio, TV, or internet chat boards days, weeks, or even months later. People hear about it for the first time and start to be curious, but they don't buy.
Step 3:
In print media, a short bit of information is given. Blogs and online message boards also start to talk about the move more. People start to pay a little more attention and buy a little more.
Step 4:
Wall Street and LaSalle Street brokers get very excited about the market and try to sell it to their clients. People start to buy in larger numbers.
Step 5:
One of the major financial newspapers, magazines, or websites has a full-length front-page story about the stock or market in question. This usually happens six months after the fact, when a market has grown the most. When all the media, brokers, and so-called "gurus" start to talk about the market, there is often a lot of buying by the public, even a frenzy.
Step 6:
As step 5 starts, the sponsors or smart traders start getting out of the market and taking their profits.
The move comes to an end, the market goes down, and investors lose money.
