Long-term stock market charts are perhaps sending a message that US equity markets may in for a lengthy period of consolidation at best, and perhaps a long bear market. From the Northman Trader at northmantrader.com:
I got a freak chart for you that’s stunning, but bear with me here because it requires some background and patience. Most of us are focused on the daily or weekly action and it’s easy to lose sight of big cyclical trends. We don’t think of them as they take a long time to unfold and the daily noise is so much more dominant.
With the advent of permanent central bank intervention sparked by the financial crisis all of us have come accustomed to markets always going up with the occasional correction in between and the timing of corrections have seemingly become shorter and shorter. Big fat bottoms that happen after just a few days of temporary terror. We haven’t seen a true bear market since the financial crisis and even that one lasted barely more than a year as central banks stepped in. The last longer term bear market came after the technology bust in 2000 when markets bottomed in 2002 and 2003 and then proceeded onto the next bull market.
It didn’t always used to be this way. Going back to 1900 there were multiple extended periods of stock markets going nowhere and trading in wide chop ranges: