Stocks Adhering to 17-Year Cycle; Recession/Stagflation Likely in 2025/2026… Sell-off Underway.
02/27/25 – “2025 is a full 17-Year Cycle from the last major decline in the stock market (not including the ~2-month Covid plunge of 1Q 2020).
2025 is a full 17-Year Cycle from the inception of Bitcoin and the move toward decentralized banking.
2025 is two full 17-Year Cycles from the start of the 1990’s bull market in stocks – a run-up that culminated with the dot-com bubble in the late-1990’s.
2025 is three full 17-Year Cycles from the start of the late-20th century bull market in stocks that began in 1974, had a major correction at its midpoint (1987), and peaked in early-2000.
2025 is 7 full 17-Year Cycles from the stock market peak of January 1906, which was followed by the Panic of 1907 and a ~2-year decline of 50% (which looks remarkably similar in magnitude & duration to the 1973/1974 ~50% crash).
All of that, and much more, reinforces the impact of the 17-Year Cycle – a cycle that is intimately connected to the magnetic swings in the Sun, Earth and the geomagnetic oscillations between the two.
However, this issue’s focus is not specifically on the recurring 17-Year Cycle of Stock Market Peaks (and Declines). Instead, it is focused on a few eerie similarities between the 2020’s and two of the more notorious examples of speculative ‘over-zealousness’ of the past century.
Déjà vu?
The 2020’s possess some eerie similarities to the 1920’s and the 1990’s. Of course, history never repeats… it only rhymes. No one should ever expect a carbon copy of what took place in the past.
In all three cases, specific sectors of the market became exorbitantly overvalued. And, in each case, there were derivatives created to keep the party going and allow the most inexperienced and uninformed ‘investors’ to jump in near the top – exacerbating the impact of the ensuing decline.
In the 1920’s, it was shell companies (modern day ‘funds’) that would purchase stocks (their only holding) and then issue shares. Once the prices of those shares (funds) were driven to unaffordable levels, new shell companies (funds of funds, so to speak) were created that would only purchase shares in the first level shell companies… and then issue their own shares.
In the 1990’s, there were many parallels connected to the dot-com craze. One was the emergence of ETFs & index funds. A prime example involves the QQQ, launched in March 1999… just in time for Joe Public to pile in to the dot-com craze and then watch its value plummet ~84% – from a peak of 120.50 in March 2000 to a low of 19.76 in Oct 2002… a plunge that many never recovered from.
In late-2023/early-2024, the SEC approved the launch of multiple Bitcoin & Crypto ETFs. In the final months of 2024, the public dove in with reckless abandon… just in time for the top.
Already, many of those ETFs (Ethereum-based ones) have lost over 45% of their value.
Those speculators were also invited/enticed into piling into other ‘shell’ investments (for lack of a better term) – like NFTs and meme coins. The Crypto Carnival was in full swing in late-2024 & peaked exactly when those speculators expected exponential gains to take hold in their accounts.
The more things change, the more they stay the same!
So, what now? First of all, this does NOT imply that cryptos are not viable in the digital age. And, it does not imply they are going anywhere.
Tech companies (at least some) did not disappear after related stocks & indexes plummeted 80+% in 2000 – 2002. However, the weaker ones were ‘culled’ and a new wave of stronger & more resilient companies slowly took hold and began to build a base… over a period of many years.
However, it did take over 16 years – until Sept 2016 – for the Nasdaq-100 to exceed its March 2000 peak. The QQQ waited until December 2016 to do the same… almost 17 years to break-even!
For further reference, the entire rally from 2002 into 2007 – before another crash in those indexes & ETFs took hold – had the NQ-100 & QQQ rebounding less than 50% of their 2000 – 2002 declines… and peaking at ~40% of their 2000 peak values.
That’s just one example of how the markets deal with a bubble. The good news is that every recovery, in recent decades, has been quicker than the one before. The bad news is that the ‘bursting’ is (likely) not yet complete. So, hold on tight.
Depending on how long those crypto prices stay depressed, or locked in a trading range well below their highs, the secondary and tertiary ramifications could lead to unintended consequences. One of those could be in equity markets. Stay tuned…” TRADING INVOLVES SUBSTANTIAL RISK
Stock Indexes are in a time of projected bearishness – in late-Feb/early-March ’25 – when all are projecting 2 – 4 week drops with acceleration lower still forecast for March ’25. They are confirming the major peaks projected for Nov 22/25, 2024 (in S+P Midcap 400 & related indexes) and the subsequent/secondary highs projected for ~January 22nd – a multi-month topping process.
That was/is expected to prepare the way for sharper declines into March ’25 and confirmation of a broader stock market (seismic) shift. That would validate weekly trend and multi-month 4-Shadow signals triggered on January 10/13th. Coinciding with that, Bitcoin projected a major peak for January 2025 and is signaling a sharp drop into the first half of March ’25.
The 17-Year Cycle projected 4Q 2024 as the most likely time for a major (multi-month & multi-quarter) peak in equities – and 2025 as the time for the next major decline in stocks. It also continues to project a recession AND stagflation in 2025/2026. Corroborating that, the DJIA is revealing eerie parallels to late-2007/early-2008 and providing a roadmap for future expectations.
What are Parallels – AND Contrasts – Between 1920’s, 1990’s & 2020’s?
How Would Late-Feb/Early-March Plunges in Equities & Cryptos Reinforce Connections?
What ‘Shadows’ Do Weekly Trend & 4-Shadow Signals Cast Ahead for Stocks in 2025?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.