Another day of direction change resulted in falling prices, as the NASDAQ lost -1.95 percent, the DJIA -1.21 percent and the S&P500 -1.00 percent, as the market reversed itself for the fourth day in a row.
A newspaper headline today posed the question if the DJIA will fall as far as 5000; that is, another 1,500 points, or about 25 percent. If that target were to become a reality, it6 would mean that the decline would have cut almost two thirds of the DJIA value at its October top of 14,164.53.
At this point, the DJIA, at 1116,547, is worth 46.2 percent of that peak value; this is about the same ratio of peak price that existed, at this stage, of the 1929 drop. However, that was not the bottom of the earlier cycle; it fell successively to 32 percent, then 23 percent, and 19 percent, before it reached bottom at just 10.8 percent of its peak value in 1929.
Moreover, the S&P500 decline, as well as the NASDAQ drop, is deeper, at this point, than the DJIA. The NASDAQ closed today at 45.1 percent of its 2007 price, while the S&P500 has fallen even further, to 43.2 percent of its 2007 top.
DJIA -1.21 percent
NASDAQ -1.95 percent
S&P500 -1.00 percent