On the heels of continued weakness in global stock markets, today top Citi analyst Tom Fitzpatrick sent King World news a powerful chart that showed that stocks are ready to see a massive 22% plunge. Below is the timely Fitzpatrick commentary, along with the chart which illustrates stocks are set to crater.
Here is what Fitzpatrick had to say, along with his key chart: “Looking at the equity market and some of the background dynamics we cannot help but be reminded of 2011. Having said that, there are also some aspects of what we saw in 1998 and some similarities with 2000 that are worth noting….
“Bottom line, we have had the view for some time that we would see a much deeper correction in the equity market (in excess of 20%). After a 2010-2011 surge, helped by QE2 in November 2010 (A move that was guided since August of that year), the DJIA peaked with a head and shoulders formation completing in early August 2011(02 August break), at the same time as stocks break below the 200-day moving average.
Continue reading the Tom Fitzpatrick piece at KING WORLD NEWS