Beware The “Top Of The Market” Gurus.

It has been one of the most profitable years in the history of the stock markets. Anything, well almost anything you bought a year ago is probably making a lot of money for you right now. I am quite please that so many people have written to me thanking me for “Profit From The Panic” because its release was so timely that they took the book’s advice and happen to buy the bottom of the March low, six weeks after the book’s release. But even without that book, a lot of money would have been made anyway because everything went up in the last year and this happened all over the world …

And now, as has happened in the past, the “Gurus” emerge. Claims of success in the market and proof of profits shout out from the newspapers everyday as more and more new faces come forth. There can be little doubt that such riches were indeed made and there can be no doubt that these claims are real. What doesn’t meet the eye is a very reliable chart pattern that tells us that this could be the market top …

As the market ran to the top of 1999/2000, there were several very prominent foreign gurus in Singapore and Malaysia. They faded as the market faded between 2001 and 2003. Only one stuck around at the bottom of 2003 (A) and was joined by two other locals as the market recovered (A to B). At the top of the recovery a year later, the market was flooded with all sorts of gurus promising wealth and easy money. I should know … I signed up for several of them with no results.

By the middle of 2004, I was wiped out while even more gurus came to the fore. By 2005, the market was no longer going up and some of these gurus faded away. I began my comeback by trading this volatile and sideways market (B to C) and managed to make considerable progress between the middle of 2004 till 2006. I started teaching at AKLTG at the end of 2006 (C). At that time, there were only a handful of gurus and a couple of them were already suffering from bad press thus leaving only three really credible ones including the foreigner from 2003.

By the time the market hit 13,500, there were approximately 4 gurus (less the two who suffered the bad press and not including myself because I am not a guru). A few months later as DOW hit 14,000 (D), there was a flood of newcomer-gurus claiming massive profits and more get-rich-quick programs here in Singapore, in K.L and very obviously in Jakarta.

The market tanked … and so did the newcomers’ numbers through 2008.

At the bottom of 2009 (E), I counted only 4 regular workshops not including my tutorial. At that time, “Profit From The Panic” was flying off the shelves to become the #1 Bestseller (FYI, proceeds from the profits of that book went to charity). The market then went into that most profitable one-year rally in recent history (E to F).

Today, if you open the newspapers, you can count no less than 12 different competitive gurus every week (not including me) teaching easy money strategies, get-rich-quick systems and claiming obscene profits from the market.

For the record, I have never made such claims because I know the market is a killer of dreams and dreamers. You only need to attend my Preview to know this to be true.

So when the new gurus emerge and my class gets difficult to fill, it only means that the easy money is about to end.

So will we go sideways in a volatile fashion like B to C or will it be another tanker like D to E?

Whatever the outcome, one thing is for sure … at the end of that period, there will only be a few gurus in the market and that will be the market bottom again.

And since I am not a guru, I guess I will still be around to write another market bottom book!

Happy Hunting!

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Comments

Hi Conrad,
I’m your WA student and I have attended your WAT preview in March. I’m actually very interested to join your program but…but scared away by the high price tag :-(

Frankly speaking, not many people can even afford the WA course fee if not with the help of credit card installment. Needless to say it further for WAT program.

Sorry to say that I have chosen other school’s Forex course instead of Yeo Keong Hee’s because of the “price tag” reason.

I hope AKLTG can review this issue for those people like me who don’t have a deep pocket.

Yes, no one can predict the market. We can only assess the most probable trend based on technical data and analysis. It seems we are looking at a good 13-month rally from Mar 2009 bottom, a good 0.618 retracement (with ref to down trend fr 2007 Top till 2009 bottom)of major indices from Mar bottom. And yes, a record low 20-day VIX (broken only yesterday). Well, I look forward to a major reversal. Number of gurus is just a “happen-to-be” indicator to me. Oh, did I mention the favourite old phrase “sell in May and go away?” :)

great post as usual!

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