Below are the downside targets based on the work of Charles H. Dow.
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13,159.43 (conservative target)
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10,500.63 (mid-range target)
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7,841.82 (extreme target)
A decline to the conservative target would be considered normal and healthy. However, a decline to the ascending mid-range target has been a consistent pattern since the 2008 low.
Because the recent increase from the 2020 low has been so unusual and dramatic, we have set aside short-term downside targets for the index. On a short-term basis, it is possible that a range of 14,854.78 to 13,159.43 would be a normal reaction to the climb in the market since the 2020 low.
Investors should look forward to the possibility of the market to decline to the designated levels. Not for the opportunity to buy at lower prices, which is ideal. Rather, declines to the levels indicated would suggest a normal and healthy functioning market.