Tops

Symptoms of Bull Market Top

Financial indicators:

1.)  High trading volume – panic buying.

2.)  Substantial buying of equity mutual funds by the public.

3.)  Shiller PE¹⁰ at historical highs with a low market dividend yield.

4.)  Mergers & Acquisitions and IPO’s calendar very robust.

5.)  Widening credit spreads.

6.)  Numbers of stocks making new highs are in decline.

Mass Psychology:

1.)  Investors use any reason to buy.

2.)  Making money in the markets appears to be easy.

3.)  Investors can’t wait to read their portfolio statements

4.)  Public infatuation with highly leveraged speculations.

5.)  The media describes the economy and markets as goldilocks (or any other word describing perfection).

6.)  Known contrarian investors are bearish – are seen as out of step with the new realities – or simply appear to be stupid or crazy.

7.)  Annuities and savings accounts are seen as dead investments.