Charles Nenner Predicts a 50% Haircut for Stocks Soon

Notice to Readers:  I'm consistently wrong about stock markets, so don't pay attention to me in that area. The following is presented for your "amusement."

From Zerohedge and Kimblechartingsolutions.com

Charles Nenner has had some good prognosticastions based on his cycle analysis.  For instance, at the end of January 2020, the geopolitical and financial cycle expert Charles Nenner made a huge call:  Nenner said, “I am more worried about the market going down 40% than making 5% more on the upside.” 

The market topped a few weeks later (2% higher) and then plunged 38% for the next several weeks. Spot on call. 

Nenner also said he was “more worried about domestic civil unrest than war in a foreign land.” We had Antifa and BLM rioting, looting and burning in Portland, Minneapolis, Chicago, New York and many other cities for most of 2020.  This was, yet, another spot on call. 

What’s Nenner seeing now?  Nenner says, “ I have a chart going back to the 1900’s, and if you connect all the tops, the tops of 1929, top in the 1960’s, 1987,...we are up to the trend line again..."

"It seems very, very unusual to break a trend line that dates back for 100 years.  So, risk is very high...

We are totally out of the market...We have been out for three or four weeks...

We have the same thing as before.  People are more afraid to miss 4% on the upside than 50% on the downside.  That’s human nature.”

How low can the market go from here? 

Nenner says, “20,000 or lower is my call.”  I asked Nenner, “You think the market could get cut in half?”  Nenner replied, “Yes.”

On the geopolitical front, Nenner says:

I see things deteriorating very fast because nobody knows what’s right or wrong anymore in the United States.

It’s very worrisome.

I think the world will take on the United States because no one has a clue what they are doing anymore. This looks the same as before the Japanese attacked Pearl Harbor because how stupid can you get. In the end, the United States will get its act together, but first, they have to be hurt very seriously.”

[Doug here:  Here's a 100 year chart of the DJIA showing the 100 year channel for this index.  The market is trying to break out of the upper end of this channel right now. But 100 years of history says it's unlikely because we'd be exceeding the 1929 bubble highs and the 2000 bubble high. 

Here's the 100 year Dow channel chart from Kimble Charting Services:

One Hundred Years of History Indicates the Market Will Likely Stall Here

Please note that, when it comes to market predictions, I am about as wrong as anyone could be, so I'd take my information with more than a grain of salt!

Interestingly enough, Sentiment Trader indicates the old Dow Theory Trading signal, which looks at the Dow Transports relative to the Dow, has triggered a sell signal.  Since the beginning of massive manipuation of the market and money since the year 2000, the Dow Theory hasn't worked well.  In fact, not many historical technical trend signals have worked well.]