Money manager Paul Tudor Jones believes the conditions are ripe for a powerful surge in stock prices before the bull tops…reminiscent of the 100% surge in the NAZ in the 6 months from October 1999 to March 2000.
The thing is the NAZ has just ‘bounced’ 117 % in the 6 months from April 2025.
The T Rex in the ointment for money managers is that you have pressure to perform and must ride the crazy train.
As Tudor says, “if you don’t play it, you’re missing out on the juice; if you do play it, you have to have really happy feet, because there will be a really, really bad end to it.”
Speculators don’t have the same pressure to perform as money managers.
For individuals it’s FOMO that gets the better of them.
From my perspective, it’s natural to look back to the last euphoric episode and look for it to rhyme.
Wall Street’s favorite pastime is extrapolation…to assume past is prologue.
As Jesse Livermore would tell us there is nothing new on Wall Street as human emotions never change.
But in markets, history and Time like to skip a beat.
It’s called the Principle of Alternation.
For example I recall well in the crash of 1987 the Street thought it was the onset of a major economic downturn ala 1929.
The ’87 crash proved to be a financial event, not an economic event.
If I am correct about a Super Cycle top the bust, that follows this 16 year boom will echo the early 1930’s.
Indeed the Roaring Twenties bull in reality was 5 years from 1924 thru 1929.
The current boom started at the bottom of the Covid Crash in 2020.
The SPX has advanced just over 3-fold since 2020.
From 1924 the DJIA advanced just over 4 fold.
That said, the bottom prior to the 1929 top was 8 years prior in 1921 at DJIA 64.
It rallied 6 fold to the 1929 peak.
The bottom of this bull run was 16 years ago.
From that 2009 low the SPX is up over 10 fold.
So while history rhymes, the market’s job number one is too deceive.
Time and Price are Mr. Market’s masters.
The market struck a major low 3 years or 1080 degrees ago in October 2022.
The market struck a major low 2 years of 720 degrees ago in October 2023.
180 degrees or 6 months ago today the SPX struck a major low.
From the SPX April 2025 low of 483 (4835) we are up exactly 720 degrees or 2 revs of 360 degrees
As show in the Square of 9 below.
Interestingly, 675 (6750) is 180 degrees straight across and opposite November mid-November the crash low in 1929.
Mirror image fold-back?
In sum, the market has run hard into a turning point. The presumption is whiplash in October.
If so it will depend upon the nature of such corrective action, be it impulsive or corrective that will tell us whether there is another leg into 2026.
Whatever the case, this fall will set the tone for markets to be shaken world-wide in 2016.