weekend update

REVIEW

The market started this gap filled week at SPX 2329. A gap up opening Monday took the SPX to 2349. Then after a gap down opening on Tuesday the market found support at SPX 2335. A gap up opening on Wednesday took the SPX to 2353, which was sold off into 2335 again. On Thursday another gap up opening took the market to SPX 2361. Then the market pulled back to SPX 2349 on Friday. For the week the SPX/DOW gained 0.70%, and the NDX/NAZ gained 1.75%. Economic reports for the week were mixed. On the downtick: the NY/Philly FED, the WLEI, the NAHB, housing starts, plus weekly jobless claims rose. On the uptick: building permits, industrial production, capacity utilization, leading indicators and existing home sales. Next week’s reports will be highlighted by Q1 GDP, the Chicago PMI, durable goods and housing. Best to your week!

LONG TERM: uptrend

This week let’s look at the big picture. The very big picture. While published data on the US stock market only began in the year 1885, we have been able to piece together, using secular Saeculum cycles and economic cycles, how the US market would have looked from the early 1700’s. As an emerging growth economy the US would have not looked anything like the European markets that do have stock market data going back that far. That data was not considered.

From around the year 1700 to 1929 the US experienced a 200+ year grand super cycle bull market GSC 1. The 1929-1932 crash, when the stock market lost nearly 90% of its value, ended GSC 2. While short in time the crash made up for it in price damage. A GSC 3 bull market began at that 1932 low.

Within GSC 1 there were five super cycles, approximately: SC1 1700-1770, SC2 1770-1776, SC3 1776-1850, SC4 1850-1857, and SC5 1857-1929. Within the current GSC 3 there have been two completed super cycles, with the third underway: SC1 1932-2007, SC2 2007-2009, SC3 2009-xxxx. Since super cycle bull markets last 70+ years, this SC3 is not likely to top until around the year 2080.