Best of the Week
Most Popular
1. TESLA! Cathy Wood ARK Funds Bubble BURSTS! - 12th May 21
2.Stock Market Entering Early Summer Correction Trend Forecast - 10th May 21
3.GOLD GDX, HUI Stocks - Will Paradise Turn into a Dystopia? - 11th May 21
4.Crypto Bubble Bursts! Nicehash Suspends Coinbase Withdrawals, Bitcoin, Ethereum Bear Market Begins - 16th May 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.Cathy Wood Ark Invest Funds Bubble BURSTS! ARKK, ARKG, Tesla Entering Severe Bear Market - 13th May 21
7.Stock Market - Should You Be In Cash Right Now? - 17th May 21
8.Gold to Benefit from Mounting US Debt Pile - 14th May 21
9.Coronavius Covid-19 in Italy in August 2019! - 13th May 21
10.How to Invest in HIGH RISK Tech Stocks for 2021 and Beyond - Part 2 of 2 - 18th May 21
Last 7 days
Virgin Media Fibre Broadband Installation - What to Expect, Quality of Wiring, Service etc. - 21st Jun 21
Feel the Inflationary Heartbeat - 21st Jun 21
The Green Superfuel That Could Disrupt Global Energy Markers - 21st Jun 21
How Binance SCAMs Crypto Traders with UP DOWN Coins, Futures, Options and Leverage - Don't Get Bogdanoffed! - 20th Jun 21
Smart Money Accumulating Physical Silver Ahead Of New Basel III Regulations And Price Explosion To $44 - 20th Jun 21
Rambling Fed Triggers Gold/Silver Correction: Are Investors Being Duped? - 20th Jun 21
Gold: The Fed Wreaked Havoc on the Precious Metals - 20th Jun 21
Investing in the Tulip Crypto Mania 2021 - 19th Jun 21
Here’s Why Historic US Housing Market Boom Can Continue - 19th Jun 21
Cryptos: What the "Bizarre" World of Non-Fungible Tokens May Be Signaling - 19th Jun 21
Hyperinflationary Expectations: Reflections on Cryptocurrency and the Markets - 19th Jun 21
Gold Prices Investors beat Central Banks and Jewelry, as having the most Impact - 18th Jun 21
Has the Dust Settled After Fed Day? Not Just Yet - 18th Jun 21
Gold Asks: Will the Economic Boom Continue? - 18th Jun 21
STABLE COINS PONZI Crypto SCAM WARNING! Iron Titan CRASH to ZERO! Exit USDT While You Can! - 18th Jun 21
FOMC Surprise Takeaways - 18th Jun 21
Youtube Upload Stuck at 0% QUICK FIXES Solutions Tutorial - 18th Jun 21
AI Stock Buying Levels, Ratings, Valuations Video - 18th Jun 21
AI Stock Buying Levels, Ratings, Valuations and Trend Analysis into Market Correction - 17th Jun 21
Stocks, Gold, Silver Markets Inflation Tipping Point - 17th Jun 21
Letting Yourself Relax with Activities That You Might Not Have Considered - 17th Jun 21
RAMPANT MONEY PRINTING INFLATION BIG PICTURE! - 16th Jun 21
The Federal Reserve and Inflation - 16th Jun 21
Inflation Soars 5%! Will Gold Skyrocket? - 16th Jun 21
Stock Market Sentiment Speaks: Inflation Is For Fools - 16th Jun 21
Four News Events That Could Drive Gold Bullion Demand - 16th Jun 21
5 ways that crypto is changing the face of online casinos - 16th Jun 21
Transitory Inflation Debate - 15th Jun 21
USDX: The Cleanest Shirt Among the Dirty Laundry - 15th Jun 21
Inflation and Stock Market SPX Record Highs. PPI, FOMC Meeting in Focus - 15th Jun 21
Stock Market SPX 4310 Right Around the Corner! - 15th Jun 21
AI Stocks Strength vs Weakness - Why Selling Google or Facebook is a Big Mistake! - 14th Jun 21
The Bitcoin Crime Wave Hits - 14th Jun 21
Gold Time for Consolidation and Lower Volatility - 14th Jun 21
More Banks & Investors Are NOT Believing Fed Propaganda - 14th Jun 21
Market Inflation Bets – Squaring or Not - 14th Jun 21
Is Gold Really an Inflation Hedge? - 14th Jun 21
The FED Holds the Market. How Long Will It Last? - 14th Jun 21
Coinbase vs Binance for Bitcoin, Ethereum Crypto Trading & Investing During Bear Market 2021 - 11th Jun 21
Gold Price $4000 – Insurance, A Hedge, An Investment - 11th Jun 21
What Drives Gold Prices? (Don't Say "the Fed!") - 11th Jun 21
Why You Need to Buy and Hold Gold Now - 11th Jun 21
Big Pharma Is Back! Biotech Skyrockets On Biogen’s New Alzheimer Drug Approval - 11th Jun 21
Top 5 AI Tech Stocks Trend Analysis, Buying Levels, Ratings and Valuations - 10th Jun 21
Gold’s Inflation Utility - 10th Jun 21
The Fuel Of The Future That’s 9 Times More Efficient Than Lithium - 10th Jun 21
Challenges facing the law industry in 2021 - 10th Jun 21
SELL USDT Tether Before Ponzi Scheme Implodes Triggering 90% Bitcoin CRASH in Cryptos Lehman Bros - 9th Jun 21
Stock Market Sentiment Speaks: Prepare For Volatility - 9th Jun 21
Gold Mining Stocks: Which Door Will Investors Choose? - 9th Jun 21
Fed ‘Taper’ Talk Is Back: Will a Tantrum Follow? - 9th Jun 21
Scientists Discover New Renewable Fuel 3 Times More Powerful Than Gasoline - 9th Jun 21
How do I Choose an Online Trading Broker? - 9th Jun 21
Fed’s Tools are Broken - 8th Jun 21
Stock Market Approaching an Intermediate peak! - 8th Jun 21
Could This Household Chemical Become The Superfuel Of The Future? - 8th Jun 21
The Return of Inflation. Can Gold Withstand the Dark Side? - 7th Jun 21
Why "Trouble is Brewing" for the U.S. Housing Market - 7th Jun 21
Stock Market Volatility Crash Course (VIX vs VVIX) – Learn How to Profit From Volatility - 7th Jun 21
Computer Vision Is Like Investing in the Internet in the ‘90s - 7th Jun 21
MAPLINS - Sheffield Down Memory Lane, Before the Shop Closed its Doors for the Last Time - 7th Jun 21
Wire Brush vs Block Paving Driveway Weeds - How Much Work, Nest Way to Kill Weeds? - 7th Jun 21
When Markets Get Scared and Reverse - 7th Jun 21
Is A New Superfuel About To Take Over Energy Markets? - 7th Jun 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Dow Jones Secular Stocks Bull Market Projection

Stock-Markets / Stocks Bull Market Jun 25, 2014 - 02:00 PM GMT

By: Trader_MC

Stock-Markets

As an investor and a speculator I am mostly interested in Cyclical Markets (Cyclical Bull or Bear Markets). On average Cyclical Bull Markets last between 4 and 5 years and Cyclical Bear Markets last between 2 and 3 years. Cyclical Markets occur within Secular Markets that define the long term trend. Over the last 100 years, history has shown that the Dow Jones Secular Markets last about 17-18 years on average. For example the Secular Bull Market from 1945 to 1963 lasted 18 years and made over 350% gains, the Secular Bull Market from 1982 to 2000 lasted also 18 years and made over 1000% gains.


The last Secular Bear Market began in March 2000. If it did not already end in March 2009, then 2013 should be the 14th year of this Secular Bear Market. On the other hand, if the Secular Bear Market ended in March 2009, then a new Secular Bull Market began in March 2009 and we are currently in the 5th year of this Secular Bull Market. In that case 9 years were enough for the Secular Bear Market to correct the previous Secular Bull Market of 18 years (1982-2000) - it is a 50% time ratio. The Dow Jones made new highs and is currently about 20% above the high on October 11, 2007 which is the reason why I favor the second possibility and I think that a new Secular Bull Market has begun in March 2009. The market is in a strong impulsive move since March 2009 bottom and I expect the market to continue to climb a "wall of worry" during several years.

On the following chart you can see the Secular and Cyclical Bull and Bear Markets:

The history of the market shows that the Dow Jones Bull Market often topped between Weeks 261 - 268. Currently at Week 275 from March 2009 low, we should be very close to an intermediate top.

Here is the period duration of Cyclical Bull Markets:

1937 low - 1942 top lasted 268 weeks 1982 low - 1987 top lasted 263 weeks 1994 low - 2000 top lasted 268 weeks 2002 low - 2007 top lasted 261 weeks 2009 low - 2014 top lasted 275 weeks (Jun 24 high)

The Primary Bull Market from major low on December 9, 1974 to major top on Jan 14, 2000 lasted 1305 weeks and had a crash in October 1987, right in the middle of this Bull Market. The Bull Market from October 20, 1987 low to Jan 14, 2000 top lasted 626 weeks which is almost half duration of the Primary Bull Market. History could repeat itself as the Bull Market from Oct 10, 2002 low to Oct 11, 2007 top lasted 261 weeks and the Bull Market from 2009 low until now lasted 275 weeks, having a crash in 2008, right between these Bull Markets. Market likes symmetry both in price and time.

The same thing happened for the Bear Markets. For example, the Bear Market from Jan 14, 2000 top to October 10, 2002 low lasted 143 weeks and the Bear Market from Oct 11, 2007 top to March 6, 2009 low lasted 73 weeks which is 50% of time duration of the previous Bear Market (143/2). History has shown that the Bear Market from Sept 3, 1929 high to July 8, 1932 low lasted 148 weeks which is very close to the duration of the 2000-2002 Bear Market (143 weeks). The Bear Market from Sept 22, 1976 to Mar 1, 1978 lasted 75 weeks which is also very close to the Bear Market from 2007 to 2009 (73 weeks).

The previous examples are showing us that history repeats itself and I am more and more inclined to think that March 6, 2009 low was the beginning of a new Secular Bull Market and that the Bear Market from 2000 high to 2009 low has ended. This Bear Market lasted 9 years (465 weeks for SPX) and looks very similar to the previous Bear Market from Jan 19, 1966 high to Dec 9, 1974 low that also lasted almost 9 years (461 weeks). It is important to keep in mind that the Stock Market movements always anticipate the general economy whether it is a recession or a recovery. That is why the Stock Market is usually not related to the economic news when a major bottom or a major top occurs.

While the majority is looking at the Megaphone Pattern correction since 2000 high and is expecting the market to go back to the lower trendline of this pattern and to make new lows, I think that it will not happen. The opinion of the majority can be used as a contrarian indicator. I think that a healthy correction in this new Secular Bull Market could push the Dow Jones to 12500-13500 (end of 2015 - half 2016) followed by a second leg up of this new Secular Bull Market.

The corrections from low to low during the previous Secular Bull Market and the last Secular Bear Market from 2000 to 2009 lasted between 334 and 444 weeks with an average of 382 weeks.

Here is the time duration of periods between the major lows:

 1974 low – 1982 low lasted 400 weeks
1980 low – 1987 low lasted 395 weeks
1987 low – 1994 low lasted 337 weeks
1994 low – 2002 low lasted 444 weeks
2002 low – 2009 low lasted 334 weeks

A major low coming at the end of 2015 or early in 2016 would fit with this 334-444 weeks range.

A top in 2014 and a low in 2016 would also match with an uptrend period of 5 years, with the period of 7 years for a top and also with the period of 7 years for a low:

According to the Elliott Wave Theory impulsive moves are made of 5 waves and I think that the market is very close to finish an extended Wave 3 and to plunge into a corrective Wave 4. As Wave 3 is extended there is a possibility that Wave 5 will be truncated. After Wave 5 I expect the market to plunge into a major low in 2016 to keep pace with its previous lows every 7 years and then to enter a new impulsive leg up for at least 5 years.

The Dow Jones and the New York Stock Exchange made recently new highs while the Nasdaq, the Russell and the Banks Index did not. Large caps and blue chips are usually the last to be sold before an intermediate correction. This divergence reinforces my view that the market is heading into a corrective Wave 4. Below are the charts of the Nasdaq, the Russell and the Banks Index representing these divergences. You can also notice that these indexes broke below their intermediate channels and backtested them. The Russell and the Banks Index are also forming possible Head and Shoulders Patterns.

Forecasting the market accurately is impossible but studying the market history makes me believe that a new Secular Bull Market has begun in 2009. I think that the money flow will continue going into the Commodities sector until the market bottoms in 2016 but once it will, investors should be back in the Stock Market. The next major low in 2016 could be a once in a generation buy opportunity in the US Market.

Trader MC
Company: Cycle Trader MC OU
Web site: http://tradermc.com
Email: contact@tradermc.com

My analysis covers different assets – Market Indexes, such as US, Europe, Emerging Markets, China, Russia etc., Commodities, Currencies (Forex Trading), Bonds and Rates. In addition to the Markets Updates for MC Members, I also post real-time Trading Alerts for MC Leveraged Members for a more aggressive strategy in all the sectors. Besides the market analysis, this site also contains Cycles Count Updates for all Market Assets, including the Forex Market.

© 2014 Copyright Trader MC - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in