It's more than just bulls and bears out there..

Wayne Gretzky's Dad told him at a young age, "you can learn to anticipate. Go to where the puck will be." Good advice if you can do it. In terms of finance, and the larger stock market moves, that means you have to think about the question, who are the major competing groups with capital at risk? There are market participants at all different time frames, with fundamental, technical, quantitative, or other reasons for having their capital at risk. Many are very long term and passive, eg. mutual fund buy / hold participants. There are long term individual investors buying or selling their favorite stocks. There are hedge funds and traders of all sizes: macro, event-driven, long/short, intra-day, market neutral, dedicated shorts, emerging markets, the list goes on. There are new strategies entering the market, transitioning between asset classes or investor segments, funds closing down, and new funds opening up. It's obviously complex, but that doesn't mean a seemingly simple model cannot capture some of the behavior. The question is, are there times when most of these competitive participants are doing nothing, and one or two groups dominate. Geopolitical risk falls in that category. So the current question is, now that we've had one or two selloffs this year already, has the situation in Ukraine stabilized sufficiently such that event-driven hedge funds are not looking to put on massive short positions? No one knows the answer to that. I suppose at various times, you could get people leaking important information about the situation, and if there is the possibility that any event might scare some market participants, then you can bet that a large event-driven fund would look to put on a position in anticipation of that, and then exit once everyone knows about it, and the fear hits its peak. "Buy the rumor, sell the news" is the cliche there. But you really have to be on top of things, and have good informational connections to do that sort of thing. From an informational outsider's view, the market may push sideways for a week or two, while it becomes more clear what might happen in central europe. In recent past military scenarios, which were probably much more clear than this one (and everything is more clear looking backwards, of course), once the apprehension stopped, and the fighting started, the market generally rallied.