A recent headline said the stock market probably won’t get back to even this year. Another said markets are in the grip of a “grim economic outlook.” And a recent article warned, “For any forecaster thinking of going public with a view on stocks, some advice: proceed with caution.” Of course, things were quite different in the fall, when headlines said analysts had become “Bullish on Stocks” and that optimism had hit an extreme. Even as late as February, a headline proclaimed, “Forget Dow 30K. It’s Already Hit 40K on License Plates.”
Analysts and journalists often extrapolate current trends into the future, and people believe what they say because current events make their words sound reasonable. But while so many were on the bull-market bandwagon, observers at Elliott Wave International were using the Wave Principle to warn that conditions were changing.
To learn more about the difference between trend extrapolation and forecasting with the Wave Principle, read “The Fallacies of Trend Extrapolation and Reliance Upon Exogenous Causality.”
If you look closely, you can see patterns in social mood that help you predict social trends. Learn more with the Socionomics Premier Membership.