What if this is not a bear market. Has the market ever fallen 20% and then recovered. Well it did of course on that famous day in 1987. The low was in on the first day. The last time a correction exceeded 20% but went no further was twenty years ago in August and (double-bottom) October 1998.
The charts show some, if not complete similarity to 1998. It was preceded by a small 12% correction, then rose to new highs, and then softened by 20% over a months (or a couple of months if you count the double bottom, and there was a consolidation with the 50% point as a base.
My other model (what is there is a bear market) also shows a recovery before falling again, so it is only at the second bottom we will know for sure.
The charts show some, if not complete similarity to 1998. It was preceded by a small 12% correction, then rose to new highs, and then softened by 20% over a months (or a couple of months if you count the double bottom, and there was a consolidation with the 50% point as a base.
My other model (what is there is a bear market) also shows a recovery before falling again, so it is only at the second bottom we will know for sure.
Trade active:
First part worked.
Trade closed: target reached:
All worked perfectly, however there was no pullback.
David Atherton
