One of the big picture forecasting tools is crude oil prices as a leading indication for the overall stock market. The first chart shows crude oil prices back to 1890 compared to the Dow Jones Industrial Average plotted on logarithmic scales. The price of crude oil is shifted forward by 10 years. The correlation isn't always perfect, but generally speaking, when there is a rise in crude oil prices, 10 years later, there is a rise in the stock market. When crude oil prices go flat, the stock market goes flat.
We are not
yet quite at that 10 year echo point in stocks, which would equate to
June of 2024, 10 years after crude oil peaked. That means the next few years are not going to be so great, especially
between now and early 2026. Early 2026 will be a great time for investors
to ride the stock market long all the way to 2028.
