S&P500 Death Cross suggests an eventual target of 313

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Chart of the performance of the major equity indices from their ultimate peak during a financial crisis caused by overburdening debt, we can see that the S&P 500 has been "massaged" more than any other market in history. Economic gravity suggests the S&P 500 will eventually drop to 20% of the ultimate peak, which would be a target of 313 and possibly within the next 18 months.

Published in: Economy & Finance, Business
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S&P500 Death Cross suggests an eventual target of 313

  1. 1. S&P 500 Death Cross is hereHistory suggests a long term target of 313This time it is real as both the SMA 50 day & 200 day are declining at the same timeThe SMA 50 day & 100 day inconclusively crossed a month ago without confirming both were declining at the sametime.
  2. 2. Looking at the following chart of the performance of the major equity indices from their ultimate peak during a financialcrisis caused by overburdening debt, we can see that the S&P 500 has been "massaged" more than any other market inhistory.Economic gravity suggests the S&P 500 will eventually drop to 20% of the ultimate peak, which would be a target of 313by 2020 and possibly see 600 within the next 18 months. S&P 500 S&P 500 1,600 1,400 1,200 1,000 800 600 400 Target of 600 by March 2012 200 Target of 313 0 by 2020 1990 1994 1998 2002 2006 2010This 313 potential target could be justified by suggesting the currently optimistic S&P 500 earnings of US$81.30 drop by35% to US$52 and then apply a desperation PE ratio of 6 times as seen in all previous significant market bottoms.

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