Stock Market Crash Next Month ?

Stocks and Shares - Stock Market to Crash Next Month?

There are lots of people who think that this stock market rally is the real deal and there are also plenty who, based on their reading of the stock charts, think we are headed for an almighty crash. I've got to admit even though I've been trading the stock markets online for longer than I care to remember, I don't know which scenario is the more likely, but I do know that I am very sceptical about the way the stock markets around the world have rebounded 50% in the past 6 months as if nothing had happened. I am also very sceptical about all the 'experts' that are sprouting up on TV saying we are now in a bull market and it's safe for mom and dad investors to start investing in the stock market again.

The market crash we saw in 2007 and 2008 was to my mind not any ordinary cyclical event, it was a horrendous meltdown that almost saw the end of the world economy as we know it, and those are not my words they are the words of Republican Paul Kanjorski of Pennsylvania back in February 2009 who said the US was within 1 hour of total financial meltdown in September 2008 and that total global economic meltdown would have happened within 24 hours if that had been allowed to happen. Certainly anybody who saw Hank Paulson stumbling and mumbling on live TV must have been aware that something very scary was going on.

So to imagine that 6 months later it's all over and everything is back to normal seems to me totally unrealistic and possibly also totally manipulated. The stock market crash of 1929 and the great depression that followed took 10 years to work itself out with numerous retracements on the stock market along the way, the first being a 48% retracement. Things may be different this time round of course, for one we didn't have people sitting at home investing in the stock market online, or blogging about it for that matter, but I guess we had the 1929 equivalent. So I'm not allowed to give stock tips but I can give you this tip if you are trading the stock market online, make sure you have your stops set ! If you get stopped out, so be it, better to lose 5%, at last once you are stopped out then you are in cash and you can reassess your position based on where the stock market appears to heading.

In the following video we see how the DOW could get to 10,500 before crashing back down and the worst case scenario sees the DOW falling back to 1562 (that's not a typo).




For further information on the possible stock market crash of October 2010 see Stock Market Crash Coming ?
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