Dow scare tactics

I wish I had a dollar for every time the 1929 Dow has been superimposed over the current index. Like this effort at Zero Hedge.

Why did the analyst select a period of two years? Because that is the period that fits.

If we compare the period 1920 to 1933 to the last 13 years, 2001 to 2014, there is a significant difference.

By 1929 the Dow had climbed roughly 400%, while by 2014 the Dow gained roughly 50% over a similar time period.

Superimposing charts one on top of the other has no sound basis in technical analysis and should be viewed as an attempt to scare the market into a sell-off. A correction may be overdue, but there are always potential buyers hoping for much lower prices.

Hat tip to John B. for sending me the Zero Hedge chart.