Nasdaq’s Achievement Topples Stock Market Crash Argument

 Nasdaq's Achievement Topples Stock Market Crash Argument

Financial experts love to spin lovely yarns

In fact, most of them appear to have chosen the wrong field; writing fables would have probably been a better choice.

The real phase of a bull market starts after it has taken out its old highs.  Until this moment occurs, it’s not a real bull market  The Nasdaq recently achieved this milestone; this was not an easy feat as it took the Nasdaq 15 years to break through the strong zone of resistance illustrated In the chart below.  A market normally doubles after breaking out to new highs, especially if it has been struggling to achieve this for 15 years.  Roughly it should trade to the 9800-10,500 ranges before putting in a long term.  Therefore until this occurs the most likely outcome is that it will experience corrections ranging from Mild to strong along the way up.

 

Dow will trade to 30K before bull market ends

An expert who has stated the same thing over and over again hoping for a new outcome

Experts like the masses are always on the wrong side of the market

Experts felt the same way when we stated in Aug of 2016 that the Dow was gearing up for a move to 21K.  However, these targets were hit at the beginning of this year. Since then we issued higher targets the second of which was 22k and that was also breached recently. The main reason for this stance boils down to market sentiment, the masses have not embraced this bull market, and therefore it is destined to trend higher. We dedicate an inordinate amount of time to mass sentiment analysis and to studying the mindset of the masses. Mass Psychology is very clear on this subject; the masses need to embrace this market with gusto; until they do, the market is destined to trend higher.

Experts would have felt the same way if someone told them that the Dow would be trading past 21K after it dropped below 7,000 in 2009.

Nasdaq’s achievements end Stock Market Crash Scenario

 

Conclusion

We don’t expect the upward journey to be smooth; along the way up we expect the market to experience corrections ranging from mild to wild.  As long as the primary trend is up, all corrections have to be viewed through a bullish lens.

The NASDAQ has just validated the statement which we first put out in 2014:

This Bull Market will trend to levels that will shock the most ardent of bulls.

This has proved to be true every year since and this stance will remain valid until the trend changes.  Buy when the masses panic and flee when they are joyous.

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