Ok. Let’s say were are bottoming. I suppose the best thing to do is to compare the angles with the 2000-2002 bear market. In time, price hit a low at 50% of the duration of the previous bear market. Price retraced the entire range which makes the slope of this bear twice that of the bear ending in 2002.
Viewing a similar chart of the Nasdaq 100 shows this bear market is much less severe than the 2000-2002 drop. Price briefly moved to near the 1×1 but recovered and is above the 1×2 angle. This points out again that the Nasdaq is much stronger than the SP500 index. Note that the Nasdaq 100 also did not make a new low as compared to the 2002 bottom.
So where does that leave us? Well, the SP500 retraced the entire bear market from 2002-2007. But the Nasdaq did not come close. It is possible the Nasdaq retraces the to the 2007 high while the SP500 remains well below.
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Fasinating charts tonight Andy,$NDX???? what happend in the Tech bubble? and why not a new low like the others? On an all chart, I have a channel drawn from the highs of 87/low of 87, and this channel falls perfectly in support of the bottom of Oct of 2002, I honestly thought we would never go thru that support, but we have, and if you notice the bottom channel line is now the other major support after “02″795, if we break that,well, we go to 400, but the top support line held Friday, and the ? is will it break thru it? If we do then do we make a new high, my only answer is that we could be in a 2nd wave down, and did we finish C, or do we need to go to 795, if we break that, well back to 90 area or 87 again. Tech is one monster, new technology all the time, the old give way to the new, and there is always new, and the failures, wow, or buyouters like Cisco. So, the Microsoft bubble era burst, but did it, Apple and Mr Softy have both survived along with countless other Tech Co’s, old ones like IBM, Xerox. The CRASH of 2000 to me was massive Panic sellers, Psychologicaly, most of those traders are still around, and have suffered nightmares ever since, and some of those traders repeated their actions all over again when this new housing bubble broke… but was it a housing bubble? I think it was the Greenspan Bubble!, and Bernanke put a pin in it, and new exactly what he was doing when he did it. Espionage, at its finest. Terrorism is a better word, it brought the Power countries down to its knees, and they are yet to get up. Ok, I shouldn’t watch anymore CSI shows, but really it is a fasinating theory? 911, Greespan, Bernanke, the rise and fall of the Interest Rate Empire….by two men, and two planes.
Libby – The Dow crashing in the 1930s. It recovered. Everything recovers eventually. Nothing is ever perfect so the only way to make money is to invest in the imperfect. Lotsa fun.