General Market Commentary – Mon 6 Apr, 2020

S&P Repeating 2000 & 2007 Patterns Almost Exactly?

This S&P chart breakdown is from our good friend Chris Kimble. This crash has come faster than the prior two so maybe the length of the pullback will not be a full 8 weeks. However that’s a big maybe…

Click here to visit Chris’s site for more charts and market thoughts.

Does History Repeat? Is does rhyme sometimes!!!

This chart looks at the S&P 500 on a weekly basis over the past 20-years.

The S&P declined by 50% during the 2000-2003 bear market. On the week of 3/23/2001, it experienced its first counter-trend rally, which lasted 8-weeks, before the bear market resumed.

The S&P declined by 50% during the 2007-2009 bear market. On the week of 3/21/2001, it experienced its first counter-trend rally, which lasted 8-weeks, before the bear market resumed.

Last month the S&P hit a low during the week of 3/27/20. Is a counter-trend rally starting right on schedule? If so, will it last 8-weeks again?

Both counter-trend rallies hit the same Fibonacci retracement level, before rolling over and resuming bear markets.

The odds are low the pattern repeats exactly! The impact would be big if it does!

We shared this pattern with members on 3/20/20, reflecting that a counter-trend rally was due to start the following week. I humbly feel it is to all of our benefits to be aware of this pattern and what to watch for in a very detailed degree, to see if the bigger pattern is repeating the bear markets of the past!

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Comments:
  1. On April 6, 2020 at 9:43 pm,
    Excelsior says:

    Interesting symmetry with the March 2001 decline and the March 2020 decline, and definitely something to keep on top of mind, especially if the relief rally gets out 6-8 weeks and looks set for the next leg lower. Thanks for sharing these comments and the longer term chart.