The Instant Recession Begat The Instant Recovery

#recession #recovery #sentiment #optimism #Bulls #Bears


It took 175 days for the S&P 500 index to go from Top to Bottom to Top, this recovery came faster than any in the past. The prior 12 cycles that saw stocks recover from a drop of at least 20% took an average of 4 yrs.

Since bottoming on 23 March, the S&P 500 has risen about 50%, with more than 40 of its members 2X’ing. About $15.2-T of shareholder value that vanished is now restored.

Wednesday, the S&P 500 rose 1.6% to 3,387.89 passing its 19 February record close. It pulled back in the last 30 mins of trading to end at 3,380, 0.2% shy of the all-time high.

The tech-heavy NAS 100 reclaimed it’s all-time high in early June and has since posted 12 more record highs.

Helping drive the fast V-Shaped recover was monetary and fiscal support, where The Trump Fed pulled out all stops and The Trump Administration /Congress works on a new aid/relief/stimulus package. At the same time, better economic data and corporate earnings instilled optimism that the recovery is happening.

Power breakouts like this 1 augurs more gains. In prior cycles when the S&P 500 broke even following a Bear market, stocks kept rising in all instances. On average, the index added another 71% before Topping out.

Improving investor sentiment will prompt participants to branch out to small and mid-cap stocks, building a stronger foundation for the overall Bull market.

Wednesday, the major US stock market indexes finished at: DJIA +289.93 at 27976.84, NAS Comp +229.42 at 11012.31, S&P 500 +46.66 at 3380.35

Volume: Trade on the NYSE came in light at 771-M/shares exchanged

HeffX-LTN’s overall technical outlook for the major US stock market indexes is Very Bullish in here. The overall support is Strong, the resistance is NIL.

  • NAS Comp +22.7% YTD
  • S&P 500 +4.6% YTD
  • DJIA -2.0% YTD
  • Russell 2000 -5.1% YTD

Looking Ahead: Investors will receive the weekly Initial and Continuing Claims report and Import and Export Prices for July Thursday.

Have a healthy day, Keep the Faith!

#aid/relief/stimulus#bears#Bulls#congress#DIA#DJIA#earnings#economy#Fed#fiscal#monetary#NYSE#President Trump#QQQ#recovery#resistance investors#RUTX#SPX#SPY#support#VXX#White House