Past Market Panics and Bottoms

Similar Trading Action Usually there is a smash, crash or panic This is followed by a retest, the market bottoms and a bull market begins The Exceptions were 2001 and 1929 However, all other panics, 1907, 1921, 1938, 1962, 1970, 1974, 1987, 1997, 1998, 2002 the market bottomed then entered a bull market

Huge Gains After Successful Retest You can break down to new lows on a retest 1907 and 1929 Lows in November after October Crash, Market Still Started Rally

1929

Conclusions Usually Panics and Crashes Mark Bottoms Need a period of basing or retesting If you come out of that period could see 60 to 70% return in the market in the next 1-2 years from the low. Only Time Panic did not mark bottom was 1929, but even then you got a 48% rally from November 1929 to April 1930