2008Jan22

Nasdaq Historical Bear Markets

The Nasdaq is now down 18.37% from highs reached on 10/31/07. A bear market occurs when the price declines by 20% or more after previously rallying by 20% or more. While it's not yet a foregone conclusion that the Nasdaq will turn into a bear, it's getting very close, and investors should be prepared for what the typical bear looks like. Since the Nasdaq index was created back in 1971, it has suffered 13 bear markets. The average bear has been 216 days long for an average decline of 36.51%. Only 4 out of the 13 bears saw declines of less than 30%, and 4 bears saw losses of more than 40%.

source: http://bespokeinvest.typepad.com/bespoke/2008/01/nasdaq-historic.html

Please visit the site and look at the data.

The Nasdaq has been declining since 10/31/2007 for 79 days down 18.37%

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Here is the chart for DOW

http://stockcharts.com/h-sc/ui?s=$INDU&p=D&yr=2&mn=0&dy=0&id=p12888605981

There is no bottom -- only support or broken support.

1 -- see how the DOW broke below Nov low 12,750
2 -- see how the DOW broke below Aug low 12,500

Now, will 12,000 hold? If it does not hold then it won't be the bottom.

For goodness sakes, I don't want Z to be wrong. I actually want him to be right.

However, I am not going to accept it as gospel that 12,000 is the bottom.

Let's just say that 12,000 is the bottom and DOW rallies. How high do you think it will go before there is resistance?

Look at how far below the 200dma the DOW is. Just looks ugly to me.