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February 27, 2018 | Is Anyone Ready for a Bear Market?

Rick Ackerman

Rick Ackerman is the editor of Rick’s Picks, an online service geared to traders of stocks, options, index futures and commodities. His detailed trading strategies have appeared since the early 1990s in Black Box Forecasts, a newsletter he founded that originally was geared to professional option traders. Barron’s once labeled him an “intrepid trader” in a headline that alluded to his key role in solving a notorious pill-tampering case. He received a $200,000 reward when a conviction resulted, and the story was retold on TV’s FBI: The Untold Story. His professional background includes 12 years as a market maker in the pits of the Pacific Coast Exchange, three as an investigator with renowned San Francisco private eye Hal Lipset, seven as a reporter and newspaper editor, three as a columnist for the Sunday San Francisco Examiner, and two decades as a contributor to publications ranging from Barron’s to The Antiquarian Bookman to Fleet Street Letter and Utne Reader.

From a technical standpoint, the S&Ps and the Dow rolled down from interesting places on Tuesday. The Indoos sputtered out precisely at the Hidden Pivot midpoint of a long-term pattern projecting above 28,000 mentioned here earlier. For their part, the E-Mini S&Ps died 20 points shy of a rally target that had looked like a lock-up. Taken together these things make me, if not bearish, then certainly cautious. Like just about everyone else who follows the markets, when I greet the new day, I take it as a given that the Dow will levitate at least 150-200 points. This expectation has become so ingrained in me that mental warning bells have begun to sound.  Few are prepared for the economic disaster that a bear market would bring. Goldman Sachs says that 4.5% on the Ten-Year Note would probably pull stocks down by 25%, but that the economy would slog through it. My gut feeling is that 4.5% on the Ten-Year would bring the Dow down by more than half just for starters and that the economy would look like a statistical war zone. Is anyone really ready for this, even those of us who have been bearish since…forever?

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February 27th, 2018

Posted In: Rick's Picks

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