A ‘GET WELL’ CARD

Is it time, yet, to send the stock market a ‘get well’ card?  A note saying, ‘Hoping for a speedy recovery?’

Is it over?
Have we hit bottom?
Are we at least in a sideways market, now? 

A few months ago, there were quite a few pundits attempting to call the bottom, but their number, I’ve noticed, has been steadily diminishing.  The reason is obvious.

We’re in a free fall.  We’re lost.  We don’t have a clue where we’re at.

Back when the VIX was in the teens, at least we knew what was going on.  Things were slow and steady, option values were low and things were relatively quiet.

Everyone just KNEW that a VIX in the 90’s was absolutely impossible.

When the Black Swan did come, the VIX readings said it all –- panic selling tumbling over fear selling which was falling on top of uncertainty selling.

After all, a bear market is different from a crash.  Bear markets are readable as such.  Technical analysts speak of ‘lower highs and lower lows.’  Probability traders call attention to the statistics of increased put buying over all buying, etc.

But a crash is an abrupt and dramatic decline in prices, usually over a relatively short time frame and across a large portion of the overall stock market.   Additionally, a crash differs from a bear market in that it’s driven as much by investor fear and uncertainty as it is by hard cold financial statistics.  Some have even referred to it as a social phenomenon.

Yes, the market IS ill.  It’s running a temperature and is weak and infected.  Unlike the ‘Black Monday’ crash of 1987 after which the market rallied back right afterwards, recovering completely in just two years, this one may be a bit different.

Send it a ‘get well’ card.