Here we have a chart of the S&P 500.
Source: Worden TC2000 v. 17 [Computer Software]. (2019). SP-500 [stock index data]. Retrieved from TC2000 database April 28, 2020.
After the fastest drop in history we have rallied up approximately 30% from the bottom.
So, the big question: WHERE TO NOW?
From what I see, the rally is getting a bit tired here as we get to the 200-day moving average. You can see this in the most recent candle showing the close toward the lower end of its range.
Also, when looking at other indicators, the market is getting a bit overbought right now.
“So, then we are in for a crash” – This isn’t necessarily true. Many pundits feel we could retest the recent low of around 2200 but given all the Fed stimulus I am not necessarily sure this will happen.
My guess (which is subject to change the moment I write this 😉), is that we come down maybe 10% or so from here.
It is even possible that we take this rest by just moving sideways before another trend higher.
The chart is, to us, simply suggesting that we play a bit of defense here, but it is only one piece of the total puzzle. As the days pass we will monitor this chart in connection our macro and fundamental analysis.
The opinions expressed in this commentary are those of the author and may not necessarily reflect those held Twin Gryphon Advisors, LLC. This is for general information only and is not intended to provide specific investment advice or recommendations for any individual. It is suggested that you consult your financial professional, attorney, or tax advisor with regard to your individual situation. Comments concerning the past performance are not intended to be forward looking and should not be viewed as an indication of future results.
Investment advisory services offered through Twin Gryphon Advisors, LLC, a registered investment advisor.
The material is for informational purposes only. It represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. It does not purport to be complete and is not intended to be used as a primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor. Neither the information presented, nor any opinion expressed constitutes a solicitation for the purchase or sale of any security.
Past performance does not guarantee future results. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the US stock market