Gabrielle W

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April 10th, 2020


Why is the stock market going up?!?!?!



I have never been asked this question more times than I have this week. Some people asked in desperation or anger as they were short the market, some genuinely curious, many elated by it.  


There are plenty of fundamental reasons one can come up with, the first and foremost being that the Federal Reserve just emptied an amount of cash into the market so large that it is barely comprehensible. Many will cry manipulation, others say that it is because big investors are hopeful about the future. "Dead cat bounce" is being thrown around frequently and an appreciation for or irritation with Donald Trump. Regardless of reasoning, most people have a theory about the surge and an opinion on it. The only 100% valid reason behind price moving up at any given time is this: The ratio of buyers to sellers.

Simply put, there are more buyers than sellers. 


Never spend time pondering and trying to understand the "why" instead of how to make money on the price action taking place. "Why" does not pay your bills. "Why" will not make you wealthy. "Why" will never give you the financial freedom you desire. People who theorize on "why" during an uptrend or a downtrend want to feel smart but our job as traders isn't to sound smart, our job is to profit! 



Instead of trading theories, trade the price.  



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