Do Stock Market predictions work?

Maybe you would like to know how to make good short-term stock market predictions.

Surely if you read this article it is because you think that I am going to tell you how I can give you a system that serves to predict the price very well.

Well look, I tell you the truth: I do not have any miraculous system to predict the price of an asset in the short term, much less to predict what will happen tomorrow.

stock market prediction
What is the IBEX 35 going to do tomorrow? I have no idea, honestly

The price movement and stock market predictions

You can think that “knowing how the price moves” you can anticipate a movement quite reliably.

The problem is that the bars of the graphics are very whimsical, and instead of doing what we think or want them to do, they always do what they want, again and again, especially if you insist on trying intraday trading, a difficult thing indeed.

The issue is that with long-term graphics does not improve much.

As you already know, the price of assets is not usually moving in a straight line, but giving a kind of lurches. Let’s say it moves in waves, but following other higher waves.

The issue that should concern us here is not so much to guess the next bar, or the next small wave, but rather to look at the medium or long-term waves.

It is in those “waves”, where we have to look for our “predictions”.

Predictions that are really a kind of “anti-predictions”, because what we are looking for is a market occurrence more likely than the “non-occurrence”.

That “occurrence” is nothing other than putting the probability on our side.

Honestly, I have no idea what the gold or the EURUSD will do next Monday.

I wish I knew.

I would be a multimillionaire if that were the case.


The reality is that I do not know.

Now, what I do know is that the EURUSD is in a medium-term uptrend and that gold is in a complicated market, like the IBEX 35.

However, it may be that the bull market of the EURUSD ends tomorrow, and that the gold and the IBEX rise by 50% in the remainder of the year, or even lower by 30. That nobody knows.

More clear examples than these “boring” assets, we have them with cryptocurrencies or with indices like the Nasdaq and successful actions.

In those cases we are already in another situation.

It is here, in those markets that rise so stubbornly, where we have to look for the “keys” to make our “predictions” in our favor.

This is nothing other than bullish trading in markets that are hot.

Believe m, it is in these cases when we are facing the winning horse.

And what should we do when we are facing the winning horse?

Well bet on it with force.

But do you know what happens with horse bets?

Well, just like within the stock market nobody guarantees that we will win. Moreover, the probability of losing is quite large.

Now, if we are facing a movement in which the masses are betting strongly for an asset, the most intelligent thing from the point of view of trading is “going with the masses”, which is quite incredible to believe, because everyone knows that in reality it is always best to bet against the masses.

However, let me tell you something.

The masses are not the ones that are in the big upward movements of the different assets.

No, those who are in those movements are strong hands, they are strong hands because they have a lot of money, and they have a lot of money because they bet strong when they have the circumstances in their favour. And the bad thing for us is that today they have everything in their favour. But still, as traders, we can try to find those movements that offer us a better chance of obtaining good profits.

Going to guess the price in the next few days for most assets is completely useless.

For example, Bitcoin today is immersed in a great correction in which it has great volatility and goes up as easily as it goes down.

bitcoin prediction
Those lines are constantly violated; that is telling something significant.

Here we do have the probability by our side

However, a few months ago, back in 2017, it was rising like foam, marking maximums during a very significant number of days.

If you see the graph you can see that you can buy at any time lose, such as March 2017, when there was a correction, but the important thing is that you see, say, a “60 or 70%” of purchases (to say the least) at those dates would have resulted in winning trades.

Can you see it?

It is in these market circumstances that we have to start operating strongly.

Long-term stock market predictions

Another thing we have in our favour is the phenomenon of long-term trends. Consubstantial trends to the quantitative semi-capitalist system in which we live.

Those long-term trends – those you already know, no doubt – are none other than the assets by antonomasia of the investment world: stocks and their major cousins, the ​​indexes.

These long-term trends tell us without any palliative that the best way to operate these assets is to negotiate upwards.

All those who, for example, have tried bearish strategies in actions consistently, will have realized that it is not worth embarking on a similar task, with or without backtests.

These long-term trends help us a lot with our predictions, but they are not predictions from one day to the next or next month. Not even for next year.


Those “predictions” tell us that the stock market rises for more years than it falls.

It also tells us that once a large index has fallen by 40 or 50%, it is quite likely that in the next few years we will see a large bull market again.

Considering that kind of thing, we can count on that making bullish predictions in values ​​is better than making them bullish.

That is why investment houses, banks, analysts, etc., like to make stock market predictions so much, although there are always recommendations to sell, of course.

The issue here is that we have to go with the probability and set aside the “predictions”.

The predictions of the type “system to win 80% of operations” are nothing but tricks, for example.

Those systems do exist, but the winning operations win 2% and the losers lose an 8.

Anyway, I’m disappointed with the issue of stock market predictions, but at least we know we can do something about this investment world. After all this is not just rolling the dice and praying.

Greetings and good trading.

Original article: Predecir el precio con garantías