Perspective on US equities since March 2009

[Lsbcal]

It's been 4 good years so far despite all the hand wringing and gnashing of teeth. And yes, there have been some worrying down months along the way. Check out the blue line which shows progress since the SP500 low of March 2009:

Anyone want to venture their predictions for the future?

 

[plex]

Always fun looking at the chart, looks like the very low risk recovery period is coming to an end by next year, after a nice long 4 year period already, and from there the risk of another major dip progressively increases.

 

[heeyy_joe]

This market is in the fourth inning of a nine inning game.

 

[samclem]

Always fun looking at the chart, looks like the very low risk recovery period is coming to an end by next year, after a nice long 4 year period already, and from there the risk of another major dip progressively increases.

No, no. Look at that blue line and at the dip 32 months into the current recovery. Now, put that low point at the origin of the chart and start yourself a new color--see, we're just 22 months into this new bull market!. It's fresh as a daisy with miles to go!

Charts are fun. Technical analysis is a hoot. "I see a classic head and shoulders with a teacup handle double whifferdill."

 

[Ready]

I wish I could provide a meaningful answer here, but the reality is that nobody knows which way the market will head into the future. Everyone likes to guess, and no matter which way we guess (up or down), about 50% of us will be right, and 50% will be wrong. So you can go ahead and make your prediction, and know for certain that you have about a 50% likelihood of giving the right answer.

 

[Lsbcal]

No, no. Look at that blue line and at the dip 32 months into the current recovery. Now, put that low point at the origin of the chart and start yourself a new color--see, we're just 22 months into this new bull market!. It's fresh as a daisy with miles to go!
..."

The problem is there was no general business recession in that period.

 

[clifp]

Since on average the market goes up by a pretty hefty amount, I always guess up.
Other than 2000- 2010 I've never been wrong over an extended period of time.
But on any given year, I've been wrong lots of times.

 

[samclem]

The problem is there was no general business recession in that period.

So, the generation of a new line requires a recession, not just a "major low" (of some kind)?

We had recessions in '49, '53, '58, '60. I'm sure the market had "lows" in these periods--dips, double-dips, "bullish abandoned baby" or other high reliability candlestick formation, etc. Maybe they didn't meet the "major low" definition, so no new line?

 

[Lsbcal]

So, the generation of a new line requires a recession, not just a "major low" (of some kind)?

We had recessions in '49, '53, '58, '60. I'm sure the market had "lows" in these periods--dips, double-dips, "bullish abandoned baby" or other high reliability candlestick formation, etc. Maybe they didn't meet the "major low" definition, so no new line?

Sam, I respect your cynical view . I hope you don't think I have some evil, ulterior motive. If I have any motive it would be to show that it can pay to be optimistic when taking investment risk. Unfortunately there are lumps of coal occasionally.

All of those lines on the chart were preceded by recessions. You're correct that I didn't include all the recessions. The chart would have gotten too cluttered to view.

Here is a chart that shows the whole picture -- one can see a few of those 1950's recession declines there. The splitting into decades is only for ease of comparison. There is no fundamental reason to start a line at the beginning of a decade.

 

[samclem]

Sam, I respect your cynical view .

Oh, I'm just being contrary. If you'd oblige with some serious technical analysis jargon this could be a lot more fun.

The charts are cool, thanks. It looks like we're doing better, for longer, than has sometimes been the case in the past.

I'd like to produce some charts based on astrology, but I'm just lacking in skill and motivation. "When the moon enters Sagittarius and the Chaikin Oscilator sends a positive signal regarding momentum, we've seen strong growth for the following 24 days, historically."