High Stock Volatility — Crash Recipe

The Frequent Market Ups/Downs are a Signal

When you are regularly coughing and sneezing, it’s a sign of something worse. It could be a severe cold, a virus or worse. Just as in the human body, ironically the Stock Market, precious metals market, and the Crypto-Market acts similar before something worse is about to happen. If you research every major market crash in history going back to 1929, the same is true. The way it normally plays out is quite a bit of up and down volatility for months, then surprisingly there is a false recovery and slight upward trend. The phony upward swing will last a couple-few weeks, then the coughing and sneezing starts again. That means, the volatility begins again; however, the 2nd time this happens –the up/down swings are slightly more dramatic. Twenty or 30 years ago that would mean 300–400-point daily swings up or down. Nowadays however, it means 600–700-point swings because the market’s value is much higher.

Guess where we are at now? That’s right my friend, we have gone through the first round of hiccups and the first false positive upward trend. The next thing to expect is the 600–700 DJIA swings that will occur once or twice weekly (or more). When that happens for several weeks, then …as they say in America “All Bets Are Off.” The crash happens afterward, and although it might not happen all at once, like a “Black Monday”, it could last months before we hit a bottom. The bottom however, will be about 40 to 50% lower than it is today. That is what will be the “real bottom” that many…