Pot Stocks: How To Spot Tops – Seeking Alpha

One of the most popular phrases thrown around by traders and investors is that “this time it’s different”, and as John Templeton taught us, these are the four most expensive words in the English language. In December we heard from all of the Bitcoin aficionados that the currency was nowhere near topping, with one author even suggesting a price target of $142,000. In January we saw the exact same thing happen with the pot stocks investors, despite them having front-row seats to the disastrous dive in Bitcoin and other cryptocurrencies. In both cases, investors/traders in the asset classes told us that “this was the last chance to get in”, “this time was clearly different”, and those not in were foolish for being on the sidelines. I think what some fail to realize about markets and asset classes is that this time is never different. Markets move based on human emotion and human emotions never change. While bubbles and crashes do not always have the same duration and the same rates of ascent or decline, they share very similar characteristics that I will share in this article.

Mark Douglas discusses this further in the below quote.

“A finite number of traders participate in the markets on any given day, week, or month. Individuals develop behavior patterns and a group of individuals interacting with one another on a consistent basis form collective behavior patterns that are observable and quantifiable, and these patterns repeat themselves with statistical reliability. Technical analysis organizes this collective behavior into identifiable patterns that can give a clear indication of where there’s a higher probability of one thing happening over another. In a sense, technical analysis allows you to get in the “mind of the market” to anticipate what’s likely to happen next based on the kind of

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