Market insiders selling at the top to retail investors. Is the crash near?

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Optimism about U.S. President Donald Trump’s pro-growth economic agenda has lifted U.S. equities to record high territory, with the Dow marking its ninth straight record close on Wednesday.

Overall, U.S. stocks are now up almost 15% since the election, boosted by Trump’s promises of tax reform, infrastructure spending and bank regulation.

The tremendously high valuations has led to some hedge funds to bet that the rally is coming to an end, as enthusiasm over Trump’s policies is overdone and political risk in Europe isn’t priced in.

The level of shorts – a bet that a stock will fall – taken out against the Dow Jones Industrial Average jumped 13% in the 30 days to February 20.

In addition, the first seven weeks of this year have seen insiders selling 5.5-times as many shares as they bought, meaning that insiders are dumping shares at an aggressive pace.

This comes at a time when retail investors are jumping into the market looking to make some quick gains.

Trump has been credited with being a major catalyst behind Wall Street’s impressive rally since election day, with some dubbing it the “Trump Jump”, as investors welcomed his promises of tax reform, infrastructure spending and deregulation.

However, recent gains have led to speculation of a near-term reversal with some fund manager likening the current stock market euphoria to the dotcom bubble, which reached a peak on the last day of 1999 and then burst dramatically.

The question remains, who or what will be the cause of the reversal.

 

Credit to: Investing.com

What is the ‘Dodd-Frank Wall Street Reform and Consumer Protection Act ‘

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The Dodd-Frank Wall Street Reform and Consumer Protection Act is a massive piece of financial reform legislation passed by the Obama administration in 2010 as a response to the financial crisis of 2008. Named after sponsors U.S. Senator Christopher J. Dodd and U.S. Representative Barney Frank, the act’s numerous provisions, spelled out over roughly 2,300 pages, are being implemented over a period of several years and are intended to decrease various risks in the U.S. financial system. The act established a number of new government agencies tasked with overseeing various components of the act and by extension various aspects of the banking system. President Donald Trump has pledged to repeal Dodd-Frank.

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Market Correction as high as 50% Is Impossible? Don’t think it can happen?

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So i stumbled this article today and I think is pretty interesting to share with my readers. I have been bearish since end of 2015 and it is quite insulting to see the market trade against my view, well, we are talking about Mr.Market don’t we.

Nevertheless, as a trader we need to know when we shouldn’t trade and obey to our rules. There are always opportunity for us to come back to reap a great profit rather take unnecessary risk.

Below is a good article where i share the same view with the author.

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What to expect for Forex for 2017

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Many world events throughout 2016 has caused the this years Forex forecast to be cloudy. With a large influence on the world currencies, politics will play a major role in setting prices this year. It will likely be a lot of volatility as it is difficult to predict market prices from politics. Even positive political influence have adversely affected markets in the past.

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Issue with technical analysis and solution to overcome them

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I always received this question when meetup with other new traders, who asking about the best way to find entries and which technical analysis strategy should they used.. And my answer is always the same: it does not matter; every system can be profitable. Entries don’t matter.

Below is a great article written by a trader called Rolf and his sharing totally resonate with my thoughts.

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