06-10-2022, 08:11 PM
Yes it can rally in the short term given it is so oversold
Dow is sitting roughly at 10yr average PE ratio.
This does not mean it is fairly valued. Interest rate is rising to highest level in a decade at the fastest pace. Earnings growth will slow and recession looms
Dow can do a short term rally but cannot sustain a longer rally
a. The moment if moves up it becomes expensive from the average
b. Markets typically stop falling only after the Fed js done raising rates.
c. Bear market rallies and dead cat bounces are common occurances as market falls.
d. Bear market durations of 2-3 yrs are most common with some stretching to a decade.
e. The great covid everything bubble of 2021 burst in Jan 2022.....
f. Don't rush in if u are waiting for a better entry level.
Dow is sitting roughly at 10yr average PE ratio.
This does not mean it is fairly valued. Interest rate is rising to highest level in a decade at the fastest pace. Earnings growth will slow and recession looms
Dow can do a short term rally but cannot sustain a longer rally
a. The moment if moves up it becomes expensive from the average
b. Markets typically stop falling only after the Fed js done raising rates.
c. Bear market rallies and dead cat bounces are common occurances as market falls.
d. Bear market durations of 2-3 yrs are most common with some stretching to a decade.
e. The great covid everything bubble of 2021 burst in Jan 2022.....
f. Don't rush in if u are waiting for a better entry level.
I, being poor, have only my dreams; I have spread my dreams under your feet; Tread softly because you tread on my dreams.