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Thursday, October 09, 2008

October 9 Bear Market Statistics

October 9 has marked several important turning points for the markets.
  • October 9, 2002 was the day the S&P500 (more charts) made its low for the 2000 to 2002 bear market.
  • October 9, 2007 was the day the S&P500 peaked on a closing basis at 1,565.15.
Could October 9, 2008 be another major turning point?

The average bear market decline is about 30%. We are currently down 38%, 37% and 40% in the S&P500, DJIA (more DOW charts) and NASDAQ (more NASDAQ charts) composite since the peak. The odds favor buying now if you have a long-term perspective and confidence like I have that the US will somehow muddle its way through this mess as it has in the past.
Click chart courtesy of stockcharts.com for full size image

2007-2008 Bear Market Statistics 10/09/08

S&P500 Chart
Last Market High 10/11/07 at 1,576.09
Last Market low 10/08/08 at 970.97
Current S&P500 Price 984.94
Decline in Points = 591.15
Decline in percent = 37.5%
Max Decline = 38.4%
=>This means the decline from intraday high to intraday low is 38.4% and we are currently 37.5% off the peak.
=>The decline in the S&P500 from the closing high to the closing low was 37.1%

DJIA Charts
Last Market High 10/11/07 at 14,279.96
Last Market Low 10/08/08 at 9,042.97
Current DJIA Price 9,258.10
Decline in Points = 5,021.86
Decline in percent = 35.2%
Max Decline = 36.7%
=>This means the decline from high to low has been 36.7% and we are currently 35.2% off the peak.
=>The decline in the DOW off the closing high to the closing low was 34.6%

NASDAQ Charts
Last Market High 10/31/07 at 2,861.51
Last Market Low 10/08/08 at 1,706.86
Current NASDAQ Price 1,740.33
Decline in Points = 1,121.18
Decline in percent = 39.2%
Max Decline = 40.4%
=>This means the decline from intraday high to intraday low is 40.4% and we are currently 0.391814112 39.2% off the peak.
=>The decline in the NASDAQ off the closing high to the closing low was 39.1%

If you want to know what I have been buying in this period of weakness with my profit taking dollars from selling when the market was higher, Subscribe to Kirk's Investment Newsletter TODAY and get the October 2008 Issue for FREE!

Could October 9, 2008 be another major turning point?

Given the average bear market decline is about 30% and we're down 38%, 37% and 40% in the S&P500, DJIA and NASDAQ composite, the odds favor buying now if you have a long-term perspective.

We could go lower or the bottom may be in. Major market turns have occurred in early Octobers of the past. I like the odds and have been buying.

Chart of market price since the peak
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