Larry's Market Comments at Critical Points

[TREND1]

Does the Stock Market Overreact ?
The Journal of Finance July 1985

page 793
Research in experimental psychology suggests that, in violation of Bayes' rule, most people tend to "overreact" to unexpected and dramatic news events.

page 75
..(1) Extreme movements in stock prices will be followed by subsequent price movements in the opposite direction. (2) The
more extreme the initial price movement, the greater will be the subsequent adjustment. Both hypotheses imply a violation of
weak-form market efficiency.

Translation:
What goes up big ! Has a high probability of coming down big !