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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum
GLD 378.35+2.7%4:00 PM EST
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To: TobagoJack who wrote (37460)7/21/2008 10:05:06 PM
From: prosperous  Read Replies (1) of 217650
 
TJ
Just looking at last bear cycle from 2000-2002

Index 2000peak 2002 bottom % down 2007 peak

DJIA 11722 7286 -37.85% 14280
S&P500 1527 776 -49.15% 1575
NASDAQ 5048 1108 -78% 2861
IYY (tot
market) 71.97 36.15 -49.7% 76.92

In this cycle down from 2007 peaks I would expect at least a 40-50% correction on indices, we had a NASDAQ bubble in 2000 so it had much larger correction of 78% but we had larger housing and financial bubbles in the 2007 upcycle so those indices would correct to a magnitude larger than 40%. A 40% correction on indices (likely on conservative side) would take them to:
DJIA: 8568
S&P500: 916
NASDAQ: 1716
IYY: 43
Even a very optimistic correction of 30% would take these indices to 9996, 1102, 2002, 53.8 respectively, will likley not go down in straight line due to several bottoms being called along the way but still seems a long way to go assuming no 6 sigma events happen and we have an orderly decline and the economy does not totally crap out(gold should protect against those) but to me it seems a time to remain short; there is too much anxious hedge fund money that is driven by greed calling bottoms at various points and jumping in but that sentiment would need to turn to fear and then we will bottom out on indices.
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