Investment manager John Hussman has issued a U.S. stock market warning that an imminent decline could occur.
Hussman has a five point indicator which he calls the “overvalued, overbought, overbullish, rising-yields syndrome.” This indicator has been triggered nine times previously in the last 40 years. The market has lost an average of 24% following the nine signals. The smallest decline was 7% following the most recent signal in January of this year. The largest were following the signals in July, 2007 and December, 1972 (57% and 48%, respectively). Read Hussman’s full analysis.
Hat tip to Prometheus Market Insight.