I’ve been bearish for a long time now but every time the market starts to dive an auto-magical rally kicks in and drives the indices back up.
We look about to enter a correction and for the first time since the credit crunch crash it looks like we are in a bear market.
Bear markets aren’t when the price of the index has fallen 20%, it’s when they trend down. A bear market isn’t a trailing indicator it’s a market state and you can see from the chart below, we have been in one for most of the year. There could be a lot more to come.
What’s more we seem to be breaking down.
This doesn’t have to be the feared crash or even a big correction but now is the time to watch carefully because this could be a big move to the downside.
If the auto-magical plunge team is on patrol there isn’t much to worry about, but personally I’m not a fan of relying on outside forces to save my hide.
The recent trend looks out of whack to the post crash rally. Does this chart look safe to you?
Im risk off but I thought these charts worthy of your attention because if you take any notice at all of the mumbo jumbo of charts, this is a fascinating set up.
Here is the bear up close, its breaking down, so those plunge team fellows better not be on holiday because the China devaluation situation just might set off the avalanche all value investors feel needs to happen.