Call me a romantic, but sometimes I just need to step back and read one book: Robert Rhea’s The Dow Theory.

Published in 1932, Rhea’s book was written to explain what Charles Dow had outlined a quarter of a century before. Rhea identified the three principal phases of a bear market:

• abandonment of the hopes upon which stocks were purchased at inflated prices

• selling due to decreased business and earnings

• distress selling of sound securities, regardless of their value, by those who must find a cash market for at least a portion of their assets

At right, I’m going to show you a chart of the NASDAQ, since that’s the index that’s been damaged the most. In fact, at one point the NASDAQ was off 70% from its March 2000 high.

But if you’ve just done a double take while looking at the chart, you’re right. There IS something fishy about this: instead of showing a normal chart of the NASDAQ, I’ve inverted it. So the selloff in the NASDAQ since March 2000 actually looks like a massive rally.

Now take a closer look at the chart:

The reason I did this is to prove a point. Just as stock prices couldn’t go any further on the upside during the hyper-rally of 1999 and 2000, it’s impossible for stock prices to keep going down. The market is currently experiencing a hyper-selloff.

In other words, in the past 2 1/2 years, the market has experienced two extreme swings — one to the upside, one to the downside.

Look at the chart when the NASDAQ was at 5,100. There was no way it could go higher because of the steepness of the rally. In other words, trees don’t grow into the sky...and neither do markets. If you invert the loss in the NASDAQ since March 2000 so it looks like a rally — it comes out structurally just like the upsurge of 1999 and 2000. The moves are almost exactly the same.

But we have history on our side. The market has already proved to us that a hyper-bull move like the one between 1999 and 2000 is technically insupportable. And the hyper-downside move between March 2000 and today is equally insupportable.

This is my point — the momentum and psychology that drove the NASDAQ to new highs is same kind of momentum and psychology driving it down to 1,650.

It’s the exact same technical method for downside moves as upside moves. In fact, it’s even more so on the downside, because there is a real floor in markets. The NASDAQ can only go down so much (0), whereas the upside potential is unlimited. So, although the NASDAQ could theoretically lose another 99%, there is absolutely no grounding in reality or history for such a development. It’s one thing for Priceline to lose 99%... it’s an entirely different thing for the NASDAQ to lose another 99%... especially when it’s already lost 70%.

This doesn’t mean it can’t go any lower. But using history as a basis for prediction, and looking at the technical formation of this selloff (70% from its highs in 13 months, which is a record for any freakin’ market ever!), odds are there’s little if any downside left.

That’s why I’m now looking to start buying. And I mean a lot.

However, what you might not know is this — on January 25 of this year, an entire herd of cattle was quarantined in Texas, suspected of eating bone meal infected with “mad cow” prions.

I’m sure nothing came of it. Almost. But one thing seems certain about the future: Europe’s livestock diseases have already rippled throughout the world. There’s bad news from Argentina. Even Saudi Arabia. Which means it is only a matter of time until it hits North America. And whether or not foot-and-mouth disease actually comes to the United States, I anticipate increasing public scrutiny of the safety of domestic meat products.

Using an electron beam to pasteurize food, the technology eliminates the threat of harmful pathogens such as E. coli, listeria, campylobacter and salmonella without affecting the food’s texture or taste.

Now, before you say people will not eat food zapped with an electron beam, let me tell you that you already do — in your microwave oven. It’s really no different than that.

And that’s what Titan is doing. Through their subsidiary and IPO spinoff, SureBeam, Titan has entered the food safety market.

Titan will retain 84% ownership of the spinoff company. And I don’t know about you... but in this market I’d prefer to own the parent company, Titan, which is a rock-solid stock, instead of buying the IPO.

Trading at a market cap of US$750 million on trailing twelve-month revenues of US$1.04 billion, Titan offers investors substantial growth potential at “value stock” prices. Titan grew the top line by 130% between 1998 and 1999. And then grew it 47% between 1999 and 2000. I love it.

Titan will grow the bottom line by 21% this year. Yet the stock continues to trade at a P/E discount to EPS growth. Titan’s PEG ratio is 0.76.

1. it’s a diversified company

2. it’s a growth stocks at value levels

3. it’s creating next-generation technologies that meet a basic human need — survival.

Titan is all three.

I think now is the time to buy Titan (TTN:NYSE) under US$16 a share.