Is the 1987 Pre-Crash Highs Impacting Prices Today?
Posted By Barry Ritholtz On December 20, 2010 @ 12:00 pm In Markets,Technical Analysis | Comments Disabled
Chris Kimble [1] writes: “Long-term support resistance dating back to 1987 looks to be at hand right now. This line stopped the rally back in April, this time going to be different?”
I am not sure why this line would be significant. In terms of supply and demand, I strongly doubt anyone is hanging around waiting for prices to return to that trend line to buy or sell.
The only explanatory that possibly works for me is the long term trendline in GDP, earnings and interest rates create an approximate fair value. And even that is a bit of a stretch.
Regardless, here is your chartporn of the day:
>
click for ginormous chart
[2]
Article printed from The Big Picture: http://www.ritholtz.com/blog
URL to article: http://www.ritholtz.com/blog/2010/12/is-the-1987-pre-crash-highs-impacting-prices-today/
URLs in this post:
[1] Chris Kimble: http://blog.kimblechartingsolutions.com/
[2] Image: http://www.ritholtz.com/blog/wp-content/uploads/2010/12/5001987higheffectingdec15.gif
Click here to print.