Friday, January 4, 2008

Market Crash???

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Starting from the August 2007 we saw 20 sessions when S&P 500 lost or gain more then 2% in a single session. In the same period there were 11 occurrences when the DJI lost or gain more then 2% in a single session. Only back before April 2003, it was last time when we saw such big concentration of crashes down and rallies up (volatility).

In period from November 2007 until now we have witnessed 4 occurrences when the NASDAQ 100 dropped down or run up for more then 3% in a session. Again, the last time something similar happened - before April 2003.

Last time we saw sessions when the NASDAQ 100 has made bigger then 4% move:
January 4, 2007 – NASDAQ 100 crushed for 4.3%
November 13, 2007 - NASDAQ 100 made 4.2% rally up
February 27, 2007 - NASDAQ 100 made 4.0% declined down
And then it was only back on March 24, 2003 when the NASDAQ 100 lost 4.3%

So what happened back in March 2003???

February –March 2003 were the last months of the long-term market crash that started in 2000. For 4 years we had peaceful uptrend and now, starting from the end of the July 2007 we have creasy market. I have already mentioned about increased craziness in December 2007 (see my Volatility post), and now it become even more interesting. The question is: is this the begging of the long-term stock market crash or it’s temporary and we may see the up-move soon again?

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