The stock market seems to picking up from the lowest point. The S&P 500 is up 58 percent from its lowest point last March. General public and experts believe that the worst of the economic recession is behind us.

But don’t be surprised if you start seeing predictions of the next stock-market crash. Find the predictions on Twitter. The popularity of talk stocks on Twitter has given rise to a whole offshoot service, StockTwits .

There are thousands of traders and hundreds of experts and professional prognosticators. Who do you believe now? One of them is BAM Investor , which markets its financial model to hedge funds. BAM stands for Behavioral Analysis Of Markets. The stockwit uses fractal theory (and the Fibonacci sequence!) to predict emotional mood swings in the market.

The recent prediction of the stock market (5 days ago) by BAM Investor says thate current stock market rally would crash by 50 percent . Its other prediction include – Crude Oil is heading down to $56/barrel. and a 400% “melt-up” in natural gas.

Why should anyone listen to these trading tweets?

BAM Investor claims that it, with the help of its financial model, predicted the crash of crude oil from $147 to $36. It also claims to predict the rise in corn and wheat futures from their 2007 lows, and the 400 percent rally in shares of Ford from February to August, 2009.

Investors should be careful while using such services. Why? BAM Investor may be using Twitter to market its financial model and you can easily subscribe to it if you are a serious investor.

A financial model is said to be successful and trustworthy if its predictions are consistent and accurate over time. Ask a few questions -can you trust it? Is it right more often than it is wrong? If the BAM Investor’s predictions start making money for its followers, then more followers will join it.

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