photo by reutersLast week the Dow was closed at lowest level since late 2006. It was traded 20% below its peak level in October 2007.
Even though declining 30% is an officially consensus of a bear market signal, but many analysts told that 20% declining on the market from its highest level is signing a bear market. These news below told us about recent bear market signal :
• Battered by Oil, Dow Touches Bear Territory (New York Times)
• Dow Hits Bear-Market Territory (Wall Street Journal)
• Stocks Near Bear Market Territory (U.S. News & World Report)
• US stocks post sharp weekly losses; bear market nears (MarketWatch)
• This Bear Has Sharp Claws (Barron's)
• Market ends lower, Dow on cusp of bear market (Reuters)
• Stocks Tumble Toward Bear Market On Rising Economic Concerns (Washington Post)
This day before market open, Crude oil trades as high as $143.67 a barrel. Oil is traded at about 80% higher than a year ago. Stocks Market direction on the long term always opposes oil prices direction. Lets look at the latest chart of the Dow below :
I found some bear market signals on the chart above such as Head and Shoulder, Descending Triangle and Descending Channel. I expect we will see soon the dow index will be at around 10.750.
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