This
is reprinted from the April 27, 2003 Indicant Weekly Stock Market Report,
Volume 4, Issue 4.
The
NASDAQ’s Short-term Indicant Bear Finally Died.
As
stated the past several weeks, until recently, the longest period of
time the Short-term Indicant went without a signal was between
October 18, 1929
and
August 24, 1932
for the Dow. During that period, it was
a Short Term Indicant Bear. The Dow fell by 70.1% before getting a bull
signal. That Short-term Indicant Bear lasted 1041 calendar days. The
market found its secular bottom in 1932. That performance preceded the
depths of the great depression. Ironically, one of the biggest bull
markets in history followed that Short-term bear leg in 1929-1932.
http://www.indicant.net/Non-Members/ST%20Tour/ST-1929.htm
The
NASDAQ’s Short-term Indicant finally signaled Bull on
April 22, 2003
, after signaling Bear continuously since
March 31, 2000
. That STI Bear market lasted 1,117
calendar days. That was longer than the Dow’s STI Bear from 1929 –
1932 by seventy-six days.
The
NASDAQ’s Short-term Bear from
March 31, 2000
through
April 22, 2003
fell by 62.2% from Bear Signal to Bull
Signal.
The
ensuing Bull Market from
April 22, 2003
through
April 25, 2003
lasted only three days. Do not get
concerned about this. It is not uncommon for the ghosts of powerful
bulls and bears to wreak a little havoc on our comfort zones. It will be
a little bouncy before the market gets enough commitment to move solidly
to the north or the south.
You
will notice that the NASDAQ’s Short-term Indicant gained 1,966 points
since 1995, while the buy and hold strategy gained 688 points. During
this period with extreme swings to the north and then to the south, the
Short-term Indicant generated a 263.7% gain. This compares favorably to
the 92.3% gain generated by the buy and hold strategy.
The
Dow’s Short-term Indicant gained 9,077.94 points between 1995 and
April 25, 2003
while buy and hold gained 4,467.85
points. The STI generated a gain of 236.5% against the buy and hold gain
of 116.4%.
We
do not recommend trading entirely on the Short-term Indicant, but if you
prefer conservative investing and can find a Dow 30 Fund or simply trade
all thirty of the stocks, then please do so. You will perform better
than buy and hold and you will definitely avoid catastrophe. Your broker
will like you as you will trade about once a month on average. The
recent three year bear leg only happened once last century (1929-1932)
and so far this century has only happened once. It is likely it will
happen again this century a few more times with all the electronic
processing. Investors have learned to funnel their emotions at the speed
of light, so to speak.
http://www.indicant.net/Members/Updates/STI-Mkts/STI.htm
Happy
Investing.......Click
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