DOW-Food for thought as we wrap up 2023
I've seen some trader's theorize the last couple of years that we will have another "roaring 20's" style stock market during the 2020's-2030's. If you compare the early 1900's chart, using a 6 month timeframe, to today's chart you would actually theorize that we are at the end of the "roaring" era. Since bottoming in 2009 we have "roared" up almost 500%...equaling the "roar" from the early 1900's era; therefore history has technically already rhymed.
Some other road blocks that bullish chartists will have to battle:
1. Japan's ATH before multiple lost decades was 38,957.44.
2. DOW's ATH in 1929 before the great depression was 386.10...if you take out the decimal you have a DOW equal to 38,610.
3. NDX ATH in 2000 before it's huge crash was 4816.35....it took 17 years after this ATH to reach 5K
4. SPX has yet to reach 5K; it's current ATH 4818.62 (interestingly, this number is not far from NDX 2000 high)
If you think the DOW will just waltz past 38,957.44 and SPX will waltz past 5K without a care in the world...you might be in for a rude awakening. Crossing these figures, IMO, will be a huge battle; let alone doing so without a breakout failure.
The DOW is a little over 4% away from Japan's ATH; meanwhile SPX is a little over 5% away from 5K.
And don't forget the US labor market is at its lowest unemployment level its had in over 54 years so you have to ask...where is this "growth" going to come from to catapult the US market given we are maxed out on the employment front.
Dotted red line on chart-High reached during the year's 1900 & 2000.
If you've followed my other posts...you'll know I am bullish from a charting perspective however I realize we have some huge hurdles to cross so I am watching & waiting for the market to shows signs of a major reversal in the coming months/year.
2022 saw a bearish reversal however the breakout from the lows in Oct 2022 did not exhibit typical bullish behavior around that low that we usually see when we breakout from a "major" market low (see my other posts about typical bottoming behavior around major lows) hence why I am very skeptical about the Oct 2022 being a major market bottom.
Will be interesting to see if we reach the above important levels during the 2024 and if so how price responds...
Always stay nimble!
Some other road blocks that bullish chartists will have to battle:
1. Japan's ATH before multiple lost decades was 38,957.44.
2. DOW's ATH in 1929 before the great depression was 386.10...if you take out the decimal you have a DOW equal to 38,610.
3. NDX ATH in 2000 before it's huge crash was 4816.35....it took 17 years after this ATH to reach 5K
4. SPX has yet to reach 5K; it's current ATH 4818.62 (interestingly, this number is not far from NDX 2000 high)
If you think the DOW will just waltz past 38,957.44 and SPX will waltz past 5K without a care in the world...you might be in for a rude awakening. Crossing these figures, IMO, will be a huge battle; let alone doing so without a breakout failure.
The DOW is a little over 4% away from Japan's ATH; meanwhile SPX is a little over 5% away from 5K.
And don't forget the US labor market is at its lowest unemployment level its had in over 54 years so you have to ask...where is this "growth" going to come from to catapult the US market given we are maxed out on the employment front.
Dotted red line on chart-High reached during the year's 1900 & 2000.
If you've followed my other posts...you'll know I am bullish from a charting perspective however I realize we have some huge hurdles to cross so I am watching & waiting for the market to shows signs of a major reversal in the coming months/year.
2022 saw a bearish reversal however the breakout from the lows in Oct 2022 did not exhibit typical bullish behavior around that low that we usually see when we breakout from a "major" market low (see my other posts about typical bottoming behavior around major lows) hence why I am very skeptical about the Oct 2022 being a major market bottom.
Will be interesting to see if we reach the above important levels during the 2024 and if so how price responds...
Always stay nimble!
Comment:
SPX DENIED...The bulls not only could not close 2023 above 4800; it did not even reach 4800 this year. Below is the yearly chart for SPX from inception in 1957...the last 3 yearly candle closings (2021, 2022 & 2023) look nothing like its past history. The red dotted lines are closing HIGHS followed by weakness years. Typically year 3 after weakness either breaks out or we are still in bear mode. IMO getting to 5,000 is becoming a HUGE task.
Comment:
We were 30.36 points away from reaching Japan's ATH...SPX did reach 5K and closed above it for 2 days before today producing what might be seen as a break out failure at the 5K level...time will tell. Time will also tell if reaching Japan's ATH will be completed soon after seeing today's downside price action.
Comment:
The Nikkei closes the daily & the weekly above 40K before the Dow.