1) So, Jim Goodman, what is your "PSYCLE" sm?
After years of thoroughly studying the price charts and behavior of thousands of stocks, industry groups, commodities, interest rates, people, and "the financial media", over the last century, I found that 95% of the things, which 95% of all people "think" should or do affect future price moves within financial markets, have rarely been the real "causes" of significant price changes.... plus, I found that 95% of all the financial information, which this "95%" incorrectly believe are important in basing their buy/sell decisions upon, are, and have always been, pretty much a useless waste of time and energy, as potential help in predicting future Price movements of the stocks/bonds/commodities they invest in!!!!
Simultaneously, I found that human (and "media") behavior, has also always remained very consistently predictable....people always tend to get over-excited and positive near Tops, and over-fearful and negative right near the bottoms, etc....If this seems "obvious" to you, then why do so Few people Buy near lows, and sell near tops ? During my 20+ years in this business, I discovered some very consistent "PSY-chological Patterns", which people and the media exhibit, at similar times, which can also be predicted, and taken advantage of.... When I combined the Psychological Patterns, with the consistent, recurring Price behavior Patterns which individual stocks have exhibited for decades, this helped me create a Sequential "picture" of the 7 stages, or phases, through which all financial items pass, over time, which I call, "The PSYCLE" sm.
2) How does your "PSYCLE" work ?
At any given time, each different issue is in one of the 7 Psycle Stages....Each stage/phase in the PSYCLE, is accompanied by a different combination of, 1) chart price/volume behavior.....2) media and investor opinions and behavior.....and, 3) perceived and actual fundamental/financial circumstances. Once I determine in what particular stage any investment is, within it's PSYCLE, I can then position YOUR assets to take advantage of the probable future price movement likely for an idea in that stage, based on the hundreds of previous times things have set up the same way.
Plus, by ignoring 95% of what mediocre traders incorrectly try to base their buy/sell decisions upon, we eliminate all the damaging, pre-conceived, incorrect (mis)beliefs, dangerous emotions, and negative attitudes, and we have a good chance of avoiding 95% of the mistakes and extra risks, which "the 95%" have been needlessly making and taking for generations---replacing them with a simple, positive, constructive set of rules/actions, with higher potentials, lower risks, and less angst and worry, in diversified portfolios, with Preset targets and stops, for Investing, Trading, personal, and Pension, short-and-long-term needs.
3) How do you create growth "Portfolios" for clients ?
After carefully viewing thousands of individual stock charts every weekend, I separate culled ideas into positive and negative, issues and industry groups, based on the most attractive chart patterns the past 100 years....then, I choose those issues which best befit YOUR financial, and psychological, objectives, needs, and situation. Each portfolio will normally contain Several positions, with PRESET upside price targets, and downside stop-loss levels, so as to limit risk to that account. No one else does this.
Because we ONLY buy "depressed" issues, and sell or short ONLY "extended" items, (and we do not view/acknowledge 95% of the information which everybody else is chasing) we are NEVER doing what "the 95%" are doing; which, if you have any experience, you know tilts many potentials to our favor, over time. Because I trade as I do, PSYCLE ideas will tend to move as expected, INDEPENDENTLY and REGARDLESS, of any real or perceived "external" news, fundamental, economic, or political situations or events.
"If" news and fundamentals "did" have the affect which "the 95%" incorectly believe they do, then analysts, media/writers, insiders, letter writers, accountants, employees, and your friends, would never be wrong.... the very fact that few "investolators" do well, tells you, that just igonring what "the 95%" are considering, alone, will greatly improve our results....
4) Who are "the 95%" you keep referring to ?
After 20 years of studying thousands of instances of the PSYCLE working, I found that the vast majority of people make less-than-supreme timing decisions/choices, based on bad, incorrect, and/or useless input.... then, they compund this situation by letting their internal incorrect and damaging Psychological problems, (mis)beliefs, predjudices, preconceived notions, etc., hinder their potential when trading/investing....what is amazing, is that even 95% of all people WITHIN the "financial industry" also fall prey to these problems (you'd think they'd be better, but generally they are terrible as well). So, after observing the continually consistently wrong "mass" opinions, over and over, month after month, year after year, I just call all these people, "the 95%", and we do very well going OPPOSITE these people, at extremes in direction....I am normally buying BEFORE moves, while the 95% only buy after "breakouts", at much higher prices, etc.
Because all these layers of "psychological" problems exist in our wonderful world, proper PSYCLE timing decisions are not easy for the average person to appreciate, never mind to put into actual practice for their benefit. Believe me, I was just as shocked to find that 95% of all the financial information disseminated in all media, is either incorrect, misleading, or just plain useless in helping to predict PRICE CHANGES in stocks, bonds, commodities, etc. Remember, part of eliminating all Emotions, is learning that you are buying a stock, NOT "the company"....they are two different things....but I digress....we save time and angst, by concentrating on the 5% of things which ARE worth acting upon.....
5) Why do so few people do well at this ?
Besides their internal psychological hindrances, and the pre-ponderance of useless/damaging output from government, corporate, financial industry, and media sources, add the terrible lack of (financial/ investing) education in this fine country's schools, plus, the fact that our society seems to want everything, in two seconds, overnite, without having to expend any effort....need I go on ? I am being very serious about this factor. If you keep trying to use the cacaphony of unhelpful information which unsuccessful traders have been trying to employ for decades, you will never improve your results. So, I have dedicated my professional life towards helping and educating as many nice people as I can reach, the rest of my life, as to the benefits of "PSYCLE" knowledge and action.
6) You keep saying you do not "use" the inputs which "the 95%" use, on which to base your timing decisions....you mean NO financial, fundamental, news, economic, political, items, etc. are useful ? I find that hard to believe....
In the limited space I have here, suffice it to say, that it is not that I do not "acknowledge" some of the output which, on the surface, would seem to be of "Future price prediction value" ("FPPV"), it's just that I do not use all that info, IN THE WAY "THE 95%" HAVE BEEN DOING for decades....the KEY, is to separate items which are just "interesting, or nice to know", from the things which will DIRECTLY LEAD TO DESIRED PRICE CHANGES in the issues being traded....see the difference ?
One example of many: since "earnings" for a company are totally manufactured, subjective, and "created" by accountants, and are normally "past" numbers anyway, they are of No "FPPV" with respect to that company's STOCK price....after all, how often are analysts (even the company itself) wrong about their estimates anyway? Companies, the government, and economists are wrong almost all the time....as have been the "doomsayers", the soothsayers, and the media.... get the picture ? So the question should be, why does anyone EVER use any of these figures, on which to base buy/sell decisions on the STOCK, at all, when financial items Cannot be reliably used to predict future STOCK prices....do you see this ? The whole "financial industry" itself is pretty much taking advantage of the public's ignorance and insecurities, yet those people are hardly ever correct !!! Very few of the "indicators" used by "the 95%", work.....
"The PSYCLE" uses simple, consistent, repeating, INGRAINED, natural patterns of human behavior, and physics, which have worked the same way for generations.....many other external elements may seem to change, but Human Nature and Physics, remain the only two constants in the universe of investing/trading, so they are the only areas one needs to master, to be very successful. The Psycle gets the most out of using just the 5% of input which normally directly helps predict future price changes....
7) You keep mentioning "Patterns", of stock price, and human, behavior.... exactly what kind of Patterns are you referring to ?
Add to the list of things "the 95%" could do a lot better, is the amazing fact that fewer than 5% of all traders ever view a stock's 1-year and 5-year CHART picture, before they invest....we do. Neither do they employ preset upside price targets, nor downside stop-loss protection....we do. I found this unbelievable. In the past 100 years (and longer, for long-term "Psycles"), stock price charts have tended to exhibit only perhaps a dozen consistently appearing Patterns, or formations. Careful study of hundreds of thousands of charts, has led to the discovery of a TWO consistently profitable long and short Patterns, from a PSYCLE point-of-view: the depressed "BASE", and the "extended umbrella top" pattern....
I have found, that when specific issues or industry groups exhibit these chart patterns, our chances of successful exploitation for my clients increases even further, especially when paired with the PSY-chological pattern work I use....for the sake of brevity here, here's one general example of the process, which has worked well hundreds of times, (remember---these ideas will tend to work, INDEPENDENTLY of any real or perceived news, fundamental, corporate, economic, items):
8) So this "Depressed Base" is kind of your key, for the long side ?
One key, yes....see, the first requirement of any potential long buy, is that is has to have been much higher in the recent past....proof that Wall St. and the "bagholders" loved it, thought highly of it (bought it, and many are still holding it), at one time....as a stock falls (in three stages, which I can explain to you later), few people sell it on the way down, because few people use stops, and fewer have the strength to admit they are wrong. At some point (and we let the market tell us when---I do No guessing, nor bottom-fishing), most all the sellers have sold....the stock Stops falling, and goes Sideways, forming a "depressed Base"....got it ?
Using my proprietary PSYCLE Technical Analysis, "Relative (Industry Group) Rotation", Volume concepts, plus my "Psycle-Sentiment" input, I am able to find suitable buy candidates every week, regardless of anyone's opinion about "the market"....a big benefit of my PSYCLE, for you.
I concentrate on issues with at least a 4/1 or better upside/downside move potential....if an idea "cracks", we sell it quickly....no "waiting to see what happens" (a sure way to lose bigger)....no emotion....no "attachments".... there are always other, better ideas around, to move our money into....
9) With what types of accounts and objectives does your PSYCLE work best ?
All kinds....Personal accounts, and Pension/IRA/retirement accounts, for growth, speculation, conservative, and income objectives....it works just as well with long-term investing, as short-term trading....from both the long and short sides....taxable, and tax-favored....in all "market atmospheres".... An additional benefit clients have enjoyed, is the significant new knowledge and constant Learning they have gleaned, just from hearing and observing what my PSYCLE says and does about all sorts of financial things.
10) Great, I understand and appreciate everything....but, before I sign on, tell me why the "short" (down) side isn't as risky as "the 95%" have told us....
First, you must realize that even fewer than 5% of all people, (even within the "industry" itself), ever take advantage of the continual stream of shorting opportunities available, every month, in "extended, topping" stocks. Why ? Because "the financial media" is just as ignorant and mis-leading as the unfortunate misbelief, that somehow, one is being "un-american" or "taking too much risk" by trying to exploit price Declines.... Funny, we all see lots of Drops in prices of stocks, every month....hmmmm. Yet so few people take advantage of the profits available on these drops.... Statistically speaking, since most long speculators lose anyway, seems many would have done better, shorting the items they incorrectly bought, right ? Plus, ALL stocks traverse the 3 declining-side PSYCLE stages, at one time or another....no specific issue rises forever....so why not take advantage of this normal, natural situation ?
Think about this: so few people play the short side, that means that every time something falls in price, 99% of the money is being made on that drop, by the 1% of people who try to take advantage of that drop.... see the logic ? Oh, and, if one diversifies, uses preset upside stop-loss orders, and PSYCLE reasoning, the "Put" side is NO more risky than any other side of trading....I never understood "the 95%'s" irrational fear about the "short side"....be smart....we will use this to YOUR advantage at times.
11: I have observed that you seem to have a stellar (but not inferred nor guaranteed) track record, with your many PSYCLE predictions, month by month, for years now....why do you say that is a "curse" sometimes?
The "problem" with a good track record, is that everybody expects huge returns, overnite, every nite, etc.....plus, they do not allow for the normal, occasional "rough periods" which even the best endure....actually, the BEST time to ADD money to a PSYCLE account, is AFTER such a period, planning to take advantage of the likely improvement in performance which inevitably follows such periods....but few people are strong enough to do so.
Jim Goodman, (949) 786-2577 or "(949) STOCKS 7", p.o.b. 17596, Irvine, Ca. 92713-7596