Current Stock Price Pattern Compared With 1973 to 1975 Recession

To compare current stocks losses to those of the 1973 to 1975 recession, I (RAH) plot the cumulative percent decline from the price tops of the Dow Jones industrial average from 1973 to 1975 recession and the current bear market starting with the October 9, 2007 peak. The chart is updated after the close of each trading day. The current downside is shown in bright blue.

Click chart to enlarge it.

For the 481 day period from January 11, 1973 (top) through December 6, 1974 (bottom), the Dow Jones industrial average fell from 1,051.7 to 577.6, a 45 percent decline. How long will the current price downside continue and how low will prices go? No one knows the future path of stock prices, but the above chart suggests that the prudent investor should plan for more downside.

See Is the Current Bear Market a Repeat of 1929 to 1932? for a visual comparison of current stock declines with the declines for the 1929 to 1932 downside.

Related Articles:

Daily Stock & Market Updates On buyupside.com - Spot Tops and Bottoms
S&P 500 Long-term Price Cycles Indicate More Downside
Is the Stock Market Making a Bottom? PDI Analysis of the S&P 500 from Its Peak to Now
Long-term Price Patterns Suggest Stocks Have Much Further to Slide - Part II
Monitoring the Market Meltdown from buyupside.com

Updated Mar-20-10.