The S&P 500 Composite (SPX) fell 5.08% over the past 3 trading days. It was the 4th decline in the 5% to 10% range since the bottom on 3/9/09 (based on closing prices only). The largest decline was 7.09% over 28 calendar days from 6/12/09 to 7/10/09.
Price pullbacks lasting a few days to a few weeks and declining less than 10% are common in Bull Markets. For example, there were 9 declines more than 5% but less than 10% from the low in March 2003 to the bull market top in October 2007. There were no pullbacks of as much as 10%, and no pullback lasted as long as 3 months.
The recent highs in the major stock market indexes are significant resistance. This morning's bounce will establish Friday's close as significant support. A decisive move through one of these two levels will likely establish the next significant trend direction.
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