Several chart analysts are pointing out that while the market has dropped sharply over the past few days, it still has a long way to go before a sustainable bottom can be reached.
The S&P 500 has nose-dived more than 6% since reaching a record high last month as the U.S.-China trade war intensified, leading investors to dump equities in favor of safer assets like Treasurys and gold. The sharp drop pushed the broad market index through key technical support levels and dented a massive year-to-date rally in stocks.
“This is a corrective phase in an upward trend that’s not yet over,” John Roque, technical analyst at Wolfe Research, told.
Frank Cappelleri, executive director at Instinet, said in a note that the S&P 500′s “bullish patterns officially are voided” with these drops, noting that the S&P 500′s 200-day moving average is the level being closely watched by traders and investors.
But the selling is not over yet, if history is any indication.
Read more:
25 Canada Square, Level 33, office 50, Canary Wharf London, E14 5LQ +44 20 3608 6256
World Financial Markets - 0700 17 600 Varchev Exchange - 0700 115 44
Varchev Finance Ltd is registered in the FCA (FINANCIAL CONDUCT AUTHORITY) with a passport in the United Kingdom: FCA, United Kingdom - registration number: 494 045, which allows provision of financial services in the United Kingdom.
Varchev Finance Ltd strictly comply with the statutes of the European directive MiFID (Markets in Financial Instruments). targeting increased efficiency, transparency and uniformity of financial instruments.
Varchev Finance Ltd is authorized and regulated by the Financial Supervision Commission - Sofia, Bulgaria: License number RG-03-02-05 / 15.03.2006
The information on this site is not intended for distribution or use by any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
Disclaimer:
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 63,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.