History tends to repeat itself

jayc
2022-04-06

History tends to repeat itself.

In 1988 and 1998, tech stocks struggled before a 10-2 inversion, then soared for months. In 2006 and 2019, tech stocks struggled before a 10-2 inversion, then soared for months.

I sound like a broken record, right?

Well, here we are in 2022. And tech stocks are struggling while the 10-2 yield curve just inverted.

It's clear what comes next: a huge tech stock rally.

Philosophically, this makes a ton of sense. You must understand that markets are forward-looking. They price things in before they happen, so markets anticipate the effect of a yield curve inversion before it happens. That causes stocks to move lower. Then, once the yield curve inverts and there's no recession happening, investors breathe a sigh of relief. And they proceed to pile back into stocks.

It happens every time. This time is not different.

History is repeating itself, folks. This means that following yesterday's yield curve inversion, tech stocks are due for a massive melt-up over the coming 12 months.

$Apple(AAPL)$$Microsoft(MSFT)$$Alphabet(GOOGL)$$S&P 500(.SPX)$$NASDAQ(.IXIC)$$DJIA(.DJI)$

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

  • Bh95
    2022-04-06
    Bh95
    Would argue this time it is going to be completely different, with crazy inflation, and energy & food crisis happening around the world, and with russia pegging Rubles with Gold. Checkmate for Dollar.
  • NeedMoneyPls
    2022-04-06
    NeedMoneyPls
    safest buy apple
  • JunioR
    2022-04-07
    JunioR
    Hard part is deciding when the selloff ends and the buy in starts.
  • destinedtwo
    2022-04-07
    destinedtwo
    Is this applicable to tech stocks globally?
    • bwjx
      China tech stocks are badly beaten last year. US tech correction just started this year.
  • 叫我發先生
    2022-04-07
    叫我發先生
    Huathuat, pls givee me a like
    • JeremyKok
      hi. please like and comment back. thank you.
  • Yckit2000
    2022-04-07
    Yckit2000
    Buy the dip and DCA
Leave a comment
1
15