Everyone Agrees – So What?
Ever since the now infamous “Six Days of August” took place in the stock market, the press has been filled with reports that it was the long-awaited correction pundits have been expecting for quite some time now.
Yes, it was, by definition, a correction.
Here is the one version from Dorsey Wright’s Monthly Update:
“It’s official – the S&P 500 Index (SPX) has seen a 10% correction since the May peak. All told from the May peak to the low on Tuesday, August 25th, the S&P 500 experienced a 12.3% pullback. This is the first time the S&P 500 has pulled back by 10% since 2012, which took from April 2012 to June 2012 to complete. While this most recent pullback has been relatively swift, this is not an uncommon occurrence, especially in bull markets. “
OK, so with that “noise” out of the way, the real question is – So What?
What investors really need to determine is:
1. Is this a buying opportunity for another leg up in the bull market?
2. Or, is this the beginning of a bear market?
The truth is, in spite of what we may read, no one knows – believe me, no one really knows.
And, that is precisely the reason why the most logical investment tactic to take is to look at the unbiased and objective view as seen in the Point-and-Figure charts.
Let’s look at the various equity markets around the world, starting with The Dow Industrial 30, here in the States: