On The Eve Of A 200 Year Top In The U.S. Market

The following is quoted from the August 4, 2017 issue of The Elliott Wave Theorist. Permission granted by  Bob Prechter, author.

“…the setup is reminiscent of 1929, which kicked off the biggest bear market in U.S. history with a crash that erased nearly 50% of the Dow’s value in less than three months. The difference this time is that the top is of one higher degree. So the bear market will be deeper than that of 1929-1932 in the DJIA, and last longer that that of the 1929-1949 Dow/PPI. It is likely, moreover, to begin with a crash, perhaps one bigger than that of 1929.”

We should note that, while the initial crash took 50% off the value of the Dow, the ultimate low in 1932 resulted in an 89% loss in the Average, and hundreds of bankruptcies in both public and private companies in the depression that followed. None of this was forecasted by the general population of market analysts and strategists. Quite to the contrary, the majority of them were optimistic, and bullish in the extreme right up to the end. It is the same today. The very same.

The ideal time for the top is now. The ideal price range for the Dow Jones Industrial Average is 23,000 plus or minus a couple hundred points, the range it is in now. October is a popular month for crashes.

The last line of Bob’s e-mail to me yesterday: “The market is ever so close…”

Good luck, everyone.

Rod

 

 

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