Everything in life is exponential – or progressive – not linear.

But, just like the earth looks flat when we walk short distances or look to the horizon, most short-term progress looks linear. So do most stock booms and busts, for that matter.

Gain some elevation between you and that horizon, and suddenly the perspective changes.

The exponentiality in stocks becomes perfectly obvious when you take a longer view, and especially when you look at the rare bubble periods, like 1912 to 1942 and presently between 1995 and 2022 ahead.

That’s the thing: Bubbles grow exponentially (progressively), visible even in the short term.

See for yourself…

Here’s the best example in the leading bubble index, the Nasdaq since 2009.

If the Dark Window scenario I’m forecasting comes to fruition – that is, stocks see a huge rally in the next several months – it would logically be a sharp, progressive move.

Note that the first wave up on the Nasdaq, from early 2009 into mid-2015, saw a 3,967-point gain in 6.2 years.

More importantly, note that the next wave up saw the same approximate point gain in just 2.6 years (almost 2.5 times faster). There’s that progressive (exponential) move.

That means the next move up could see a 3,924-point gain in 42% of the time, or 1.1 years. So, we could see the Nasdaq break 10,000 by January 2020 because bubbles follow this exponential path. That would be a 63% gain from the December lows.

Who on Wall Street is expecting that?!

If the markets make lower lows ahead, that would reduce the targets. If the Nasdaq falls all the way back to its strongest lower trend-line support at 5,500, I’d only expect the blow-off rally to take the index up to 9,400. Still, that would be a 71% gain from a lower start.

If we have this final blow-off rally, the odds are strongly that it won’t go out with a whimper, or a slight new high, as most bullish Wall Street analysts are predicting.

Instead, it will go out with a bang, bringing the largest one-year and most progressive run we’ve seen thus far.

If the S&P 500 can hold 2,300 in the weeks ahead, this final blow-off or Dark Window rally is even more likely.

If the Nasdaq can hold 5,500, a good bit lower, it’s still a clear possibility.

Harry
Follow me on Twitter @harrydentjr

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Harry Dent
Harry S. Dent Jr. studied economics in college in the ’70s, but found it vague and inconclusive. He became so disillusioned by the state of his chosen profession that he turned his back on it. Instead, he threw himself into the burgeoning new science of finance where identifying and studying demographic, technological, consumer and many, many other trends empowered him to forecast economic changes. Since then, he’s spoken to executives, financial advisors and investors around the world. He’s appeared on “Good Morning America,” PBS, CNBC and CNN/Fox News. He’s been featured in Barron’s, Investor’s Business Daily, Entrepreneur, Fortune, Success, U.S. News and World Report, Business Week, The Wall Street Journal, American Demographics and Omni. He is a regular guest on Fox Business’s “America’s Nightly Scorecard.” In his latest book, Zero Hour: Turn the Greatest Political and Financial Upheaval in Modern History to Your Advantage, Harry Dent reveals why the greatest social, economic, and political upheaval since the American Revolution is on our doorstep. Discover how its combined effects could cause stocks to crash as much as 80% beginning just weeks from now…crippling your wealth now and for the rest of your life. Harry arms you with the tools you need to financially prepare and survive as the world we know is turned upside down! Today, he uses the research he developed from years of hands-on business experience to offer readers a positive, easy-to-understand view of the economic future by heading up Dent Research, in his flagship newsletter, Boom & Bust.