6 April 2010, 23:21
Another alarma met in the blogosphere. The idea is, that the growth of markets for 12 Months, from a historical point of view indicates downright radical overbought.
OK, let's face stories. I took a month old Dow Jones with 1900 of the year + year-to-year change. As a result, we have a set of historical overbought rates..
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As a result, we have unpleasant real overbought (followed by a significant drop in the market): 1907 year, ± World War I, 29and, early 36th and late 70s. At the same time, the fall followed with a noticeable delay..
On the whole, overbought (how in practice, so in theory) - relative thing. Nothing overbought can get more overbought.
From myself. I am not against alarms, it's just always worth remembering the limited use of conclusions.
From myself 2. But it was a good market 100 years ago ...