Advisor sentiment hit similar lows during these periods. The disconcerting difference in 2008 is how far the DJIA fell below its 40 week (approx. 200 day) moving average, at it worst the difference was nearly 35%. As a result a snap back rally could take on the proportions of a bull market, climbing 20% to 25% without ever crossing above the plummeting 40 week average.
Until the DJIA trades and manages to stay above the 40 week moving average it must be considered in bear market territory. Certainly at some point it will move and stay above the long term benchmark and the preceeding rally will have to be considered part of the new bull market. For now that is not the case.
The DJIA 1970 low compared to the 2008 low.
Click to enlarge.
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