Monday, November 17, 2008
Saturday, November 15, 2008
MCO and MSI intiation history during crazy market times.
After today’s crazy market action, I went back and analyzed to find out if there was any historical context that could be used to interpret the current situation. Leaving aside the 2002 bottoming that took months, the closest match comes around the LTCM crisis time in 1998. I’ve attached some charts circling the area of interest. What I find interesting is, the pattern replicated itself again with two major differences.
1. LTCM pattern was in the context of a secular bull market, while now it is a secular bear market. If one LTCM can create one month of crazy action, I can’t think how many months the current hedge funds problems will cause.
2. The intermediate term market forecast indicator remains very weak while during the LTCM crisis time the recovery was strong.
1. LTCM pattern was in the context of a secular bull market, while now it is a secular bear market. If one LTCM can create one month of crazy action, I can’t think how many months the current hedge funds problems will cause.
2. The intermediate term market forecast indicator remains very weak while during the LTCM crisis time the recovery was strong.
Thursday, November 13, 2008
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