10-12-2011, 11:55 AM
The interesting thing about how prices move is that it becomes a self-fulfilling vicious cycle. Much of it would be sentiment-driven and thus unpredictable, but it essentially involves fear and trepidation that prices will fall, and buyers will become increasingly "greedy" to get better prices, while sellers get increasingly fearful about not being able to book a profit.
When there is even a hint of prices "crashing" (say 10%), it would reinforce this loop and the result may be a crash. The timing is not predictable, but the sequence of events is always the same!
When there is even a hint of prices "crashing" (say 10%), it would reinforce this loop and the result may be a crash. The timing is not predictable, but the sequence of events is always the same!
My Value Investing Blog: http://sgmusicwhiz.blogspot.com/