Long term trend - many crisis but only a few that reset
So far the bounce off the covid low has returned to the middle of the major uptrend. Where next? I'm certainly seeing more bearish sentiment out there this week.
My long-term trend analysis shows there are many worries and crisis that cause day to day moves but only a few truly reset the trend lines. 2000 and 2008 were the most recent ones.
Covid has all the fundamentals of a true reset but so far we've returned to the middle of the uptrend.
It will take another major news item to move off the trend significantly (election?).
Notes,
The uptrend lines maintain a constant % gap, hence they appear to diverge on the way up. They're parallel in % gain terms.
This % view helps as most traders/investors talk in terms of % gains/losses. and also helps frame the current volatility - a 700 point move in the Dow today is the same 2.45% move as a 350 point move in 2008 and a 280 point move in 2001.
My long-term trend analysis shows there are many worries and crisis that cause day to day moves but only a few truly reset the trend lines. 2000 and 2008 were the most recent ones.
Covid has all the fundamentals of a true reset but so far we've returned to the middle of the uptrend.
It will take another major news item to move off the trend significantly (election?).
Notes,
The uptrend lines maintain a constant % gap, hence they appear to diverge on the way up. They're parallel in % gain terms.
This % view helps as most traders/investors talk in terms of % gains/losses. and also helps frame the current volatility - a 700 point move in the Dow today is the same 2.45% move as a 350 point move in 2008 and a 280 point move in 2001.
Comment:
The bounce back has been amazing, but the trend remains intact and we're now hitting resistance right into the election and potentially failed stimulus. A shock on either could be a reset trigger.