2010 was a great year for the stock market, but it certainly wasn’t easy for most investors. Do you remember any of this?
May – The Flash Crash occurred - The Dow Jones Industrial Average plunged about 900 points only to recover those losses within minutes. It was the second largest point swing, 1,010.14 points, and the biggest one-day point decline, 998.5 points, on an intraday basis in Dow Jones Industrial Average history.
July – The Death Cross triggered – The 50-day moving average crossed over a declining 200-day moving average. Many market technicians predicted massive market declines.
August - The Hindenburg Omen triggered - A combination of technical factors that attempt to measure the health of the NYSE, and by extension, the stock market as a whole. This trigger signaled increased probability of a stock market crash.
August – The WSJ reported that a recent poll revealed that 66% of Americans believed that the economy was going to get worse before it gets better. Everyone was talking Double Dip Recession.
Thankfully, at Hays Advisory, we have a disciplined, unemotional investment approach that helped us navigate these volatile markets in 2010.
As we enter 2011, we find our Psychology indicators have weakened as investors have become less fearful. On the other hand, we have good Monetary conditions, a stock market that is Extremely Undervalued and a positive Market Trend. What does all of this mean?
To read today's complete Market Comment, click here.
Please see important disclosures at the bottom of this page.