SAMT Blog
Seasonality patterns re-align
05. August 2022, by Ron William
Technical Analysis
Global markets clearly decided to “sell in May” (SIM) this year, but rather than “go away”, opportunistic speculators returned “straight away”, with S&P500 bouncing twice by almost 10% from oversold extremes during late May and mid-June (Figure 1). Market professionals are now debating if they should buy the dip, or sell the rally?
- spx how low.jpg)
Latest market insights featured in a media interview link, which also reviews the change in market regime and implications for a reassessment of market & mind strategies. Moreover, it helps to answer the question “how low can it go?” by overlaying tactical structural levels based on Dow theory and Fibonacci ratios.
Most important is the make or break level at 3520, a 50% retracement of the 2020 uptrend. Breaking here extends downside scope into pre-pandemic peak-gap between 3370 and 3260, near 3220, a golden ratio of 61.8%. The grand finale structural level is at 3100, representing a two-third retracement and potential technical reversal of the bull-run from 2020. This would also reinforce the “Minsky crash pattern”.
Returning to the original theme of seasonality, further useful analysis can be found in these annual cycles which can bring a marked change not only to the weather, but ...
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