• 526 days Will The ECB Continue To Hike Rates?
  • 526 days Forbes: Aramco Remains Largest Company In The Middle East
  • 528 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 928 days Could Crypto Overtake Traditional Investment?
  • 933 days Americans Still Quitting Jobs At Record Pace
  • 934 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 938 days Is The Dollar Too Strong?
  • 938 days Big Tech Disappoints Investors on Earnings Calls
  • 939 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 940 days China Is Quietly Trying To Distance Itself From Russia
  • 941 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 945 days Crypto Investors Won Big In 2021
  • 945 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 946 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 948 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 948 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 952 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 953 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 953 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 955 days Are NFTs About To Take Over Gaming?
  1. Home
  2. Markets
  3. Other

The State of The Trend

With the end of March and the first quarter behind us, it's time to look at the longer-term SPX charts.

The monthly swing chart shows the current upswing as being the second longest in SPX history following the 31 month long '62 - '65 upswing:

S&P500 Chart 1
Larger Image

Chart courtesy of OT Signals

This puts the spotlight on the 50 year or Jubilee cycle and merits a closer look. In 1965 the bull run concluded on May 13th, and was followed by a 10% drop which ended on June 29th. This drop was followed by another rally which ended with the bear market of 1996 when the SPX lost 22.2% between February and October.

There are further similarities in price behavior between the two periods. In 1965 the 10% drop was preceded by price moving below the Swing angle, and dropping below the trailing stop-loss level. Currently, the SPX is already trading below the Swing angle which marked the March '15 top, but still above the monthly trailing stop-loss at around 1980:

S&P500 Chart 2
Larger Image

Chart courtesy of OT Signals

In summary, the SP500 started and finished trading the first quarter of 2015 in a box:

S&P500 Chart 3
Larger Image

Chart courtesy of OT Signals

Which way it breaks out of the box is likely to determine the near-term direction of the index in April. Considering that the length of the current rally is pushing the boundaries of historical precedents, even in the case of an upside breakout increased caution going forward will be warranted.

 

Back to homepage

Leave a comment

Leave a comment