Many ancients saw ominous warnings in the sky. It is no big secret that stock traders and investors can be as superstitious as the mystical priests of Pharaoh’s high court.
Last week, the extremely rare Blue Moon was visible, and it was immediately followed by a Blood Moon.
The DJIA fell 666 points on Friday.
Trump told the world that the US has never been better, economically, during his annual State of the Union Address.
Many traders, like ancient Druids, most have what dark things that these occurrences portend. By the time traders were done reading the coffee grounds in the bottom of their low fat milk lattes, the US stock market had begun to cool.
Oh! Many omens do portend nefarious goings on in the US stock market.
On February 5, 2018, following last week’s blood moon and mystical 666 point drop on Friday, the offerings to the free market demons continued. The continued market drop can be felt across the broad market spectrum. Nevertheless even with the slight rebound in USA trading today, the domino effects continued into the Asian markets.
Furthermore, notable trading days from March 6, 2009 satanic 666 point drop, 2320 registers days in which S&P 500 index Peak rose 4.31 times. In the later history of the post crisis rebound of the “ 100 years bubble” only two days May 6, 2010 and August 8, 2011 recorded, when the trade was comparable or slightly higher presently. Notably on one closing day August 8, 2011.
On February 5, 2018, S&P 500 experienced 4.1% drop and DJI experienced 4.7% drop, if you include post trading sessions the drop reached 6%. Hence the record was registered of 405 trading days without 6% correction.
Since March 2009 there were three market correction periods over 10%.
1) May 2010- October 2010
2) August 2011-November 2011
3 August 2015-February 2016 (two phases)
Since January 2018 S&P 500 correction is at 8.2%.
Current market showing the strongest swing since the history of trading.
1) Growth Speed
2) Number of the continues highs
3)Record low volatility
4) Series of non corrected movement
5) Deviation from the fundamental macroeconomic markers.
6) Scale of the bubble in comparisons to GDP etc.
Tech factor characterized by extreme volatility and major corrective movements, whilst reaching 30% and higher, especially Crisis in Asia taking place in 1998, moreover it is the opposite, record low volatility and the duration of the exponential growth completely overrode everything in the history of trading.
My millennial generation traders have never seen such drop, it was easy trading operations of buying and selling shorts without any losses but pure profits. However such operations led to an imbalance, as the market continued to grow with zero volatility.
There is a high it will not be a traditional correction in the Bull Market and it could lead up to 50% correction and potential to last years. It could be said that in 2015 the market was on the doorstep of the Kondratiev Winter cycle and in 2018 we are in the midst of the full winter cycle. Kondratiev was Russian Economist and published a book in 1925 “The Major Economic Cycles”. Unfortunately he was executed in Soviet Russia, but nevertheless his astounding work continues to be a guide. He has 4 cycles corresponding to the 4 seasons. Winter-Depression is the period of excesses correction and preparing the foundation for the future growth. The characteristics are prices falling, decline of profits and stock market correction to the downside. Specifically looking at the K-Waves Model, it could be predicted the continuation of the markets in a downward pattern until 2020, continuing factors the global debt and cryptocurrency and fiat money wars.
