One of the most interesting things in the stock market, is watching people trade stocks and engage in crowd behavior. This has been very evident in the recent market decline. When the market was going down, the crowd was selling into at any price, causing the stock market crash. In the media, at the same time, all the voices were discussing selling, selling, selling in a uniform chorus. As you can see from the market action, the herd suddenly stampeded, almost without warning into a 13% market decline in only five weeks until the end was reached and even then extreme volatility prevailed. What should your stock trading strategy be?
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