What will the S&P 500 bring next? That is the subject of discussion in our latest premium analysis! Order and receive TODAY!
As COVID-19 spreads across the U.S., the economy is teetering on the verge of collapse. Initial jobless claims came in at 6.6 million yesterday, bringing the three-week tally to nearly 17 million. The unemployment rate is estimated to have already surpassed its 2008-2009 recession level.
Economists at Goldman Sachs, Morgan Stanley and the IMF predict a 25%-30% GDP drop in Q2. Yet, against this nightmarish backdrop, the S&P 500 index rose 12% this week. The only reasonable explanation for the stock market surge can be the Fed pumping liquidity into the system by the trillions. Apart from that, with the economy falling off a cliff, the bulls’ optimism makes no sense at all.
Excepts that it makes perfect Elliott Wave sense. The chart below, sent to our subscribers before the open on April 6th, explains.

The hourly chart above revealed that the 35% coronavirus selloff was a textbook five-wave impulse pattern. According to the theory, this meant that at least a three-wave recovery should be expected. At the start of the week, the surge from sub-2200 didn’t fit that description.
So, despite all the reasons to be extremely bearish, we thought “the bulls are ready to lift the market higher.” Four trading days and over 300 points to the north later, here is an updated chart of the S&P 500.

The index started rising immediately on Monday and never looked back. The price even exceeded 2800 on Thursday before the markets closed for the holidays. And while the S&P 500’s 27% recovery keeps puzzling the economic community, Elliott Wave analysis gave us an edge once again.
What will the S&P 500 bring next? That is the subject of discussion in our latest premium analysis! Order and receive TODAY!