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Monday, January 11, 2010 5:38:09 PM
Long term look at NASDAQ. Calling a bottom or a top is hard but everything is clear in retrospect. Fear is rampant at market bottoms. It can be completely ignored by the masses at market tops even though volatility sometimes begins to rise in advance of the final market top.
But what can be said for sure is that once the market finds a cyclical bottom even after a failed bottom like that in 2001 the ultimate bottom will lead a cyclical advance that typically lasts around 17 months. It might be more. It might be less. It might be that even after profit taking hits in one sector that other areas of the market will rally for an extended period of time.
Note that the semiconductor index hit its high far in advance of the overall Nasdaq after the bottom in 2002.
But what can be said for sure is that once the market finds a cyclical bottom even after a failed bottom like that in 2001 the ultimate bottom will lead a cyclical advance that typically lasts around 17 months. It might be more. It might be less. It might be that even after profit taking hits in one sector that other areas of the market will rally for an extended period of time.
Note that the semiconductor index hit its high far in advance of the overall Nasdaq after the bottom in 2002.
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