Stupidity and All-Time Highs

As we head into today's trading session, the S&P 500 Index is just 0.26% below its all-time highs. February 24, 2014     Stupidity and All-Time Highs   Stats don't lie--all-time highs are no big deal Are you investing in shark infested waters? Plus: What's wrong with "being right"?   Greg Guenthner coming to you from Baltimore, MD... Greg Guenthner The obsession with all-time highs is making us all a little dumber these days... As we head into today's trading session, the S&P 500 Index is just 0.26% below its all-time highs. After fighting back from a January swoon, stocks are on track to potentially break free once again this week... "Not that that's anything new," we're reminded by my trading buddy, Jonas Elmerraji. "Since 1982, almost half of the S&P 500′s closes have been within 5% of all-time highs. That's a staggering statistic, especially considering the fact that it includes some major market corrections along the way." And it appears the bear market bias is still very much alive and well--even among professional money managers... "Most investors off the street have a lot of trouble computing the fact that stocks spend most of their time near highs - even the professionals do. Not long ago, I saw a note from a very prominent and well-respected hedge fund manager on Twitter saying that 'all major crashes happen after new highs' - so the fact that the S&P was breaking record levels in 2013 meant that his crash scenario looked more likely," Jonas explains. "That's one of the stupidest things I've ever read." "It's like saying that most shark attacks happen in the water," Jonas continues. "Of course they do - I'm no marine biologist, but it's my understanding that's where sharks spend most of their time. Going swimming doesn't make you likely to get bitten... "Likewise, since the market spends most of its time near highs, any market event (be it a crash, a snow day, or even higher new highs) is likely to happen after new highs get taken out." Your top goal this week is to avoid the collective stupidity of the all-time highs crowd and trade what you see... That's what Jonas is doing. Get his watchlist now while you still can. This offer goes offline in just 3 days...         The 3 Magic Words You Need to Know Immediately Most Americans would do just about anything to kill Obamacare for good… The bad news is that it looks like it is here to stay. But there is good news, too. Three ordinary words could allow you to legally "opt out" of Obamacare forever. Act now! Go ahead and click this link or the video above to see how you could easily opt-out of Obamacare forever.           Rude Numbers Targets, Predictions and Wild Guesses   450 million WhatsApp users are worth $42 each, according to Facebook's purchase price. By that metric, the acquisition isn't quite as outsized compared to the Instagram deal, when FB paid $30 per user. 24.5% of mobile devices in North American are connected to 4G, while just 2.9% are connected in Western Europe, according to the Wall Street Journal. 5.4 million PS4's have been sold worldwide, meaning Sony may be about to catch up with Nintendo's 5.86 million in Wii U sales - even though the latter had a one-year head start. $1,335 is where you'll find gold futures this morning. Precious metals are up slightly to begin the new trading week... 37 points dropped from the Shanghai Composite today. The Chinese index finished the session down 1.75%...     Rude Trends When to Buy... When to Sell   "Successful traders are reactionary," Jonas reminds us. "So instead of trying to predict where the market's going, we wait for the market to give us the green light before we click 'buy'. Predictions are for people who want to look back and say, 'I was right'. Trading is for people who want to look back and say, 'I made money'. By reacting to technical price action in stocks, a trader is going to be a little bit late on every entry and on every exit -- that's the nature of the beast. But by forgoing a tiny bit of missed theoretical profits on every setup, Jonas and his readers dramatically decrease the risk of every position they take on. "In the long term, that means much-bigger profits than if we'd tried to predict what a pattern was going to do ahead of time," he says. "There's no question that it's a stressful time to be an investor," Jonas explains. "Right now, lots of folks are agonizing over where the market is heading in 2014. But while most investors spend their time worrying about whether they're "right" about the market, we'll just concern ourselves with making money." Click here to join him... [Ed. Note: Send your feedback here: rude@agorafinancial.com - and follow me on Twitter: @GregGuenthner]     Ignore At Your Own Peril Today's Must Read Links   Bigger than Benghazi, the IRS and the NSA Scandals... Combined? Save Yourself From Obama's Next Power Grab Obama's Next Move That Turns Us Into the "North American Soviet Union"     BE SURE TO ADD dr@dailyreckoning.com to your address book.       Additional Articles & Commentary: Join the conversation! Follow us on social media:         The Rude Awakening is committed to protecting and respecting your privacy. We do not rent or share your email address. By submitting your email address, you consent to Agora Financial delivering daily email issues and advertisements. To end your Rude Awakening e-mail subscription and associated external offers sent from The Rude Awakening, click here. Please read our Privacy Statement. For any further comments or concerns please email us at rude@agorafinancial.com. 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