Today’s chart could be titled ‘ a short history of the stock market’, and comes from a recent chart of the day which is a great website for all kinds of interesting data. With the recent rally in overseas markets (everywhere excluding Australia it seems) I thought it was pertinent to include this and look at the long term numbers on the Bulls and the Bears.
Many are already suggesting that the current rally in the U.S. has reached its apex, which may in fact be true, however the data can support both the Bulls and the Bears. The chart bases its numbers on the fact that the current rally started in October 2011, rather than March 2009, so one could argue that the current upswing is still well behind the curve so to speak. If you believe that the rally started back in March 2009, then we are likely closer to the average. There has been around 750 trading days since then and the market in the U.S has rallied around 100% which would put us pretty much in the middle of that blue box.
Of course I don’t know the answer, and no one else is likely to either for that matter, but the chart is an interesting one given it shows a clear pattern of the length and strength of rallies. So the lesson as always is stay in your seat as this one might have longer to go and if it doesn’t you need to be sitting down for when the next one starts!.