This chart of the 1996 Nasdaq correction looks very similar to previous corrections.Â
From its intraday high in May to its intraday low in July, the market moved down ~20%.
Judging from reader comments, I need an operational definition of “leg down.” While I’ve not settled on one yet, I’m thinking that any period where the market does not make new lows can be considered a bounce, or consolidation, and when those lows are subsequently broken this would represent the start of another “leg down.” Up for discussion is how many days without new lows are required for a period to be a consolidation or bounce. I’m leaning towards 2 days.
One interesting development from this examination of tops is that the Stochastics consistently have nailed the bottom. Combining a Stochastics buy signal with a requirement for volume to be x% greater than the 50 day average when the signal occurs might make for a profitable way to play corrections.
Finally, I want to continue to emphasize that these moves typically come in waves (legs). The selling tends to dissipate after a capitulation day.
excellent work on previous tops.
Now, to top shit off, the mother of all tops: 2000.
Definitely, 2000 is a must.
However, there are many interesting tops out there. I plan to cover as many as I have data for.
any chance at the 1990 banking index?
Try overlapping it with todays bank index chart.
ownage.
I can’t find a 1990 BKX.
Maybe there is something else?
pull up old tickers, instead.
Big bank stocks.
just a thought c bac fnm fre len ctx
bearshitter.
Funny.
I’m more long than short, and banking coin today.
Bullshitter.
I’m just heckling.
I know. Still, didn’t want anyone to think I was losing money today. That would be just fucktarded.
If you include my long term positions, I am actually still net long too. But I’ve been accumulating longer term puts, and they are getting short term effed right now.