Friday, October 20, 2017

Black Monday's 30-Year Anniversary

The majority, driven by headline fear, was forecasting a 1929-style collapse, crisis, and various other forms of chaos. Tape readers that listened to the message of the market and ignored the majority's fear saw the secondary and primary trend flip from bearish to bullish by mid 1988. The rest is history.

Please review the computer's output from 1987 to 1990 to better understand how the majority fears were misplaced and how the minority of tape readers benefited by standing against them.

Headline: Black Monday anniversary: How the 2017 stock market compares with 1987

Is the stock market’s seemingly relentless 2017 rally anything like the 1987 run-up that ended 30 years ago Thursday with the most devastating one-day plunge in Wall Street history?

At first glance, investors might think so. And charts arguing the case have made the rounds from time to time. But on closer examination, many of those comparisons don’t hold water.

Here’s a look at a pair of charts from LPL Financial that illustrate the point.



Market-driven money flow, trend, and intermarket analysis is provided by an Insights key.