Interim Relief Rally Highs Will Soon Occur
Based on the signals from the SCPA (crash statistical probability analyses) and the Bull & Bear Tracker algorithms its probable that the stock markets of the US and 12 other countries that have been crashing have reached or will soon reach their interim relief rally highs. The markets for all 13 began their crashes on February 20, 2020. The SCPA had forecasted the relief rally highs to occur by April 14, 2020. Seven of the 13 countries had reached their relief rally highs by April 16, 2020.
The remaining six countries reached their intraday relief rally highs on April 29, 2020.
Reason Why Relief Rally Highs Will Occur
The likely reason for the six countries not making the SCPA’s relief rally high deadline is because they were late to arrive at the 34%-decline-from-the-2020-high party. Four of the countries in the table below which arrived early to the party have since reversed from their relief rally highs to reach new interim 2020 lows. Brazil and Spain tied the plumb-the-new-low award with declines of 5% below their initial correction lows. At their relief rally-highs the four countries got to within 28% to 30% of their 2020 highs.
History Of Crashes
The 90-day price charts for the US in 1929 and Brazil in 2020 market crashes below are a testimonial for the SCPA’s accuracy. The 90-day pre and post-crash price behavior for two indices 91 years apart from their all-time highs is virtually identical. The crash, post-crash event dates and percentage changes are definitely forecastable.
The chart below for the 1929 Dow Jones composite will likely be the path that Brazilian stock market will follow on its journey to its Q4 2022 final bottom.
The SCPA is forecasting a 100% probability for the following post-crash of 2020 events:
- Post-crash volatility to power cumulative 500% of long/short trading opportunities. See “Market volatility to power 17% monthly gains through October 2022”, April 29, 2020.
- New lows for the markets of nine countries which have yet to penetrate their initial 34% March 2020 correction lows. The lows will occur between May 9 and May 22, 2020.
- 100% probability that world economic depression has already begun and will last until at least 2023. See “Worldwide 1930s Style Depression Has Begun”, April 27, 2020.
- The markets of the 13 of the countries to decline by 79% from their 2020 highs by Q4 of 2022.
My prediction is that the S&P 500’s secular bull market which began in March 2009 ended on February 19, 2020. The ninth secular bear since 1802 began on February 20th.
Michael Markowski has been involved in the Capital Markets since 1977. He spent the first 15 years of his career in the Financial Services Industry as a Stockbroker, Portfolio Manager, Venture Capitalist, Investment Banker and Analyst. Since 1996 Markowski has been involved in the Financial Information Industry and has produced research, information and products that have been used by investors to increase their performance and reduce their risk. Read more at BullsNBears.com
Lance Roberts is a Chief Portfolio Strategist/Economist for RIA Advisors. He is also the host of “The Lance Roberts Podcast” and Chief Editor of the “Real Investment Advice” website and author of “Real Investment Daily” blog and “Real Investment Report“. Follow Lance on Facebook, Twitter, Linked-In and YouTube