Tags: prechter | bear | market

Prechter Sees Deep, Years-Long Bear Market

By    |   Wednesday, 12 Aug 2009 11:56 AM

Superstar stock picker Robert Prechter says the bear market isn’t finished with us yet.

"The big question is whether the rally is over," he told Yahoo! News.

He says he’s not sure how long the current bear market rally will last.

“But what I’m quite sure about is that the next wave down is going to be larger than what we've already experienced," Prechter says.

“I think we’ll definitely break the March 2009 lows, and I think the bear market will extend well into the next decade. … This is the top of the kind of degree that we haven’t seen for a couple hundred years.”

Prechter cites several reasons why stocks will drop.

First, “the market has gone so far, so fast. It’s gone up 50 percent … in five months,” he explains.

“That’s a huge move. On March 9, only 3 percent of traders were bullish, the lowest reading ever recorded for the S&P. … Now we’ve had back to back days in the 87 percent area. People are pretty excited about the S&P again.”

Too excited in Prechter’s estimation. He sees the dollar bottoming, another bearish sign for stocks and recommends that investors switch to cash.

Not everyone shares Prechter’s bearishness, at least in the short term.

Atticus Capital, a giant hedge fund that profited nicely on stocks’ decline last year, ploughed more than $3.5 billion into U.S. stocks in the second quarter, Bloomberg reports. It put $355 million into Bank of America shares alone.

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Superstar stock picker Robert Prechter says the bear market isn’t finished with us yet."The big question is whether the rally is over," he told Yahoo! News. He says he’s not sure how long the current bear market rally will last.“But what I’m quite sure about is that the...
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2009-56-12
Wednesday, 12 Aug 2009 11:56 AM
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