Match Up, Sell Off May 2010 vs Sell Off Aug 2011
May 2010 saw the stock market fall 15%, August 2011 (so far) also has seen a 15% sell off. Is it the same or is it different. Investors get ready it could hurt!
May 2010 sell off 15%
- Greece woes was blamed
- Flash Crash was also blamed
Aug 2011 sell off 15% or so
- Europe woes
- China slow down fears
- USA recession fears
Is it different this time? If you review the count of new 52 week lows on each price plunge down, then you must say that IT IS different this time. There is more fear about as Managers liquidated positions aggressively.
The Aug sell off does not look like May 2010, it looks more last Nov/Dec 2007. Therefore we can expect more false rallies, pumps ups and consolidations that will eventually fail. One thing we are very sure of with the Aug 2011 sell off is that we are yet to see the massive climatic sell off as we saw Feb/Mar 2009.
We expect a pause in the US dollar rally. Then we expect a Wyckoff test of the trend, then to be followed by an explosion upwards as all suddenly realize the bear market is full throttle.
Of course is USA does a full Zimbabwe then that's a game changer.
Get ready for more market fun.
Reference: Latest SP500 Review