I Was Wrong.. Kind Of

Yesterday I wrote that I expected the DOW to decline by at least another 1000 points on 2/28/2020. I admit when I am wrong and in this case I was. It only declined by end of day by -357 points.

Sometime during the day the unofficial damage control team jumped in and stopped the decline from being worse. Maybe a few large investors and/or algorithms decided to “buy the dip” with a low success rate. The result was a truly volatile day. When I say volatile, I mean look at a graph of the day and it looks like a raging fire.

I mentioned in my last article how I expect panic to set in when the market drops around 4000 points. The truth is, when you factor in the last two days of the previous week, the market has dropped very close to that number.

Media reporting. If you pay attention to something in financial media, you notice a trend. When the market increases by, say 1000 points, they say it rose by 1000 points. When the market declines, corporate media states the decline as a percentage, making the number seem smaller. This is one reason more panic has not taken hold. You will also notice that overall, they keep a narrow focus on daily changes when the market declines and a wider focus as it rises. Such as, “The market declined 5% today.” Yet they will say, “The market increased by 3000 points over the past month.”

Using real numbers. You will notice that when I state numbers going up or down, I use the actual numbers, not percentages. The straight numbers are far more illustrative and continuous…