Super-Cycle CorrectionSM Friday, November 21, 2008
The early October 2008 DJIA failure well below 10,000-9,700 violates previous sustained trend support from the last major cycle low in December 1974. Unless and until it can Close back above the 10,500 area, it will remain a secular bear phase that is manifesting itself as the Super-Cycle CorrectionSM. While there are interim supports along the way, major up trend channel support needed to be rebased from the July 1932 low, and that reinforces various factors that point to much lower levels.
This report contains a significant amount of background on why it occurred, how the failure is now moving beyond primary causes, estimates of how much further the equity markets may need to fall.
There is also an extensive Fiddler's Notion exploration of what investors and government officials will need to ‘Un-Learn’ to adapt both investment philosophy and crisis management psychology for the future.
Cick to Read
Super-Cycle CorrectionSM analysis
Read Financial Times' Tony Jackson on Equities' Fair Value Inferences (2008-10-27)
Read FT's Tony Jackson on IMF's Daunting Downbeat Factor Confluence (2008-11-03)
Click to Watch
Super-Cycle CorrectionSM slide show
(Due to some very significant inconsistencies in the manner Microsoft Office 2003 and 2007 open slide shows, we were forced to save this in Adobe Acrobat format. The bad news is that it is no longer displayed in full screen view. The good news is the ability to zoom in on the compressed long term charts and graphs. As the PDF file is sizable, you may experience a slight delay prior to all of the slides being fully loaded.)