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Bull Market Phases; Swiss Franc Bet Pays Off

By Jon S. Strebler


THERE ARE A NUMBER OF WAYS TO (TRY TO) IDENTIFY THE END OF A BULL MARKET. It's usually easy only in retrospect; in real time, it's often pretty hard to do. The great Dow Theorists – Charles Dow, William Hamilton, Robert Rhea, Richard Russell – all wrote about the signs of speculative excess as the market reaches its ultimate peak. In a bull market, prices outrun values. In its final stage it is discounting possibilities only (Hamilton). The low-priced 'cats and dogs' historically make great moves (Russell). The opinions of newspaper writers, services, and brokers are rampantly bullish (Rhea). Veteran traders look back at those months and wonder how they could have become so inculcated with the "new era" view as to have been caught in the inevitable crash (Russell). Dow himself observed that bull markets normally run 4-6 years, with Rhea suggesting that approaching the far end ... Log in or subscribe to continue reading.

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