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Similarities with the 2002 Bear Low (revisited)

About six weeks ago (see http://safehaven.com/showarticle.cfm?id=12425), I discussed the similarities between the current market and the 2002 low and it paid off handsomely for my subscribers who were warned that Venus turned retro on March 6th, just like it did at the exact low on October 10, 02 (see http://astrocycle.net/Mar6_17.php).The market did turn up rather sharply from the Venus retro of March 6th, much like it did near the same levels in October 2002, and its only natural to look for other similarities than the 60% decline from the highs common to both lows.

Longer term comparison

The first thing we notice on the longer term charts on the right is that the market is weaker than in 2002 since it keeps making lower lows than the equivalent 2002 lows. The second thing we notice is that the fear or Put protection being bought is declining instead of rising into the October 02 low or being equal at the March 03 test of the lows. The third thing we notice, is that the Tick selling is still making record lows, while it left a higher low divergence at the October 10, 02 Venus retro low. This is a warning that we have not seen the final low yet and will probably do so with a higher Put/Call line and a higher low Tick divergence.


Printable Chart


Printable Chart

Courtesy of StockCharts.com

Shorter term comparison

So far we have had a four day 14% rally like just like the Venus retro of October 02, and are due for the first pull back day on Monday. As you can see, that 14% rally failed to take us to the Wave 1 low of 800, and even failed to take us to the previous Wave 4 high of 780. I think the best the bulls can hope for is to reach the blue down trend line form September 08 near 800 by Tuesday and any pull back this week that does not hold 720 will be a sign new lows are probably coming. However this low looks so good, and so many traders who missed it and are not chasing it will probably buy the next pull back and give us another rally into end of month before they give up in April.


Printable Chart


Printable Chart

Courtesy of StockCharts.com

 

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