Chart Courtesy of Stockcharts.com
In late 2000, as the Internet bubble continued to melt from it’s historic 5000 level, I was learning for the first time that markets don’t always rally and bail you out on the long side. Sometimes, pullbacks turn into corrections, bear markets evolve into meltdowns, and bubbles pop. I suffered a large drawdown in 2000 and going into 2001, I began to believe that one day the NASDAQ would return to 5,000, as Internet companies learned to make money. I thought that the inflationary pressure on the dollar, and the ability of corporations to adapt, evolve, or die would bring NASDAQ back. These time valuations are not based on eyeballs, hopes, or views. Today, many companies make money, not just Microsoft, Intel, and Cisco. AAPL, Google, Ebay, Amazon, and Facebook are all survivors. However the target is not really NASDAQ 5000, it’s the NASDAQ all-time high of 5,132.52. That’s only 3.4% from 4963, and there is a good chance that we see this level in 2015.
This is the big one