10.11.2025
I have labeled the SPX fromthe 2009 low as five waves ending now. Wave 2 was shallow which means under alternation that wave 4 will be deeper and it was. Wave 3 is the longest and srongest of the three. This is evidenced by the PMO momentum indicator at bottom. Turn out the lights the party is over.
Bear markets are said to exist in three phases, denial, fear/despair, and capitulation. We are in denail phase. One 'analyst' commented that the tariffs would not deter the bull market. No social mood ending in five waves will. Fear occurs as it dawns on committed long term investors they have lost serious money, that was not supposed to happen. They forget as social mood requires the 2007-2009+, and 200-2002 debacles. No one is alive who experienced 1929-1932, a loss of 90% of the DJIA. A requirement of a true vicious bear market is the lack of participants in the last one. A 65 year old Financial Planner began in 1982 at the age of 25. He or she never experienced the dreary bear of 197.3-1982, 1.000 to 800 in 8 years. Notice the drop from 1966 high to the 1980 low. Now the ration of DOW to GDP is even higher than the 1966 high. This spells trouble. Us the stock market really worth140% of the gross domestic Product of the entire USA,uh no it is not.
DOW Industrials 19803-1932, how many buy and hold studies covered this period, remember stocks fall seven times faster than they rise.
Notice the DOW recovered half its drop by spring 1930, but then collapsed tp the summer of 1932 bottoming at 42-43. And that was the blue chip stocks,Many smaller companies simply went broke and disappeared. One third of the gbanks closed with depositor savings wiped out.
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