Widows and Orphan Stocks Highlight Market Risk

Clorox makes a variety of household brands. Sales are steady, profits are steady. The stock has been in a general uptrend going back to the 1980s. It overshot to the upside in the 2000s bubble and came down. It overshot again in 2020. In both cases, the stock had already cratered when the bear market started. An investor who bought Clorox at the end of March 2000 would only see a small, brief loss in the bear market. I suspect this time will be different, depending on if the forming inverse H&S pattern completes or if it fails and signals a larger top is underway. The takeaway right now isn't to buy Clorox, but that we have yet another sign that a major bear market is underway.

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