While it's far too early too call it a trend, we can certainly think in terms of hypotheticals.
Enter Citi chart guru
"Initial Claims, one of our favorite leading indicators of the overall economic picture, appear to be bottoming, pointing to a deteriorating employment situation in the US," said Fitzpatrick. "Fitting with idea that a low could be forming just as it did in late 1978."
Again, it's too early to call a turn in jobless claims.
Here's Fitzpatrick's chart overlaying the Dow today with the Dow during the 1970's
Fitzpatrick concludes:
We continue to believe that the charts above are compelling and suggest:
– The economy and in particular the employment picture look set to once again deteriorate with initial claims set to move higher over 2013 and possibly 2014. The pictures on small business, ISM and consumer confidence are all “flashing red” for us.
We continue to expect the Equity market to move lower this year with the down move possibly extending into 2014. At least a 20%+ fall in the DJIA (High to low) and possibly as much as 27% is still our bias. Again, as in the fixed income markets we suspect that the interference/kicking the can dynamic means that the moves lower in both yields and Equity markets may be more extended in time taking us into late Q2/early Q3.
Fitzpatrick's commentary also includes an expectation for gold to surge.
Read more at KingWorldNews.com.