close icon

S&P 500: Is “Black Monday” Appropriate?

They called it a “Black Monday” again. Every time the stock market crashes unexpectedly, they call it “black” day. It sounds good in the titles. It makes people click on the link and read the article. But what does it mean? An unexpected big sell-off, right? It seems the key word here is “unexpected”. But if one expected it, should he still call it “black”?
On April 21st, 2015, we published “S&P 500 Ready For 15 Percent Correction?”. The title speaks for itself. While S&P 500 was trading above 2100, we were preparing for a major decline. On the daily chart of the index there was an almost finished ending diagonal.
black monday s&p500 daily 21.4.15
According to the Elliott Wave Principle, this pattern is followed by a “swift and sharp” reversal. In other words, once wave 5 of (5) of III was over, the S&P 500 was supposed to “fall by roughly 300 points to around 1850”. The next chart shows what has happened since that forecast.
black monday s&p 500 daily 24.8.15
They called it a “Black Monday”, because they did not expect the S&P 500 to fall as low as 1833. But Elliotticians did, so should we call it “black” too? No. In our opinion, the whole decline from 2136 to 1833 is just a natural correction, which could have been, and was, predicted. A good example of the Wave principle’s forecasting capabilities.



Stay informed with our newsletter

Latest Elliott Wave analysis on different topics delivered to you weekly.

Privacy policy
You may also like:

S&P 500: Last Four Moves Made Elliott Wave Sense

Over a month ago, on November 8th, we published an article demonstrating the Elliott Wave principle‘s ability to predict relatively large moves in the S&P 500. As the move in question progressed we decided to take a closer look into its structure to see what is left of it. The chart below was part of…

Read More »

Nikkei 225 Can Lose 30% in Next Corrective Wave

The Japanese Nikkei 225 reached a multi-year high of 24 448 in October 2018. The last time the index traded this high was 27 years ago, in 1991, in the aftermath of the Japanese asset bubble. However, the bulls couldn’t maintain their momentum last year, which opened the door for a decline to 18 949…

Read More »

S&P 500: Triangle Pattern Leads to New Record High

The S&P 500 reached new all-time highs on the back of better-than-feared earnings season and improved US-China trade prospects. The index closed at 3085 Thursday, bringing its 2019 tally to the impressive 23.1%. But was there a way to predict this move instead of just explaining it after the fact? To paraphrase Warren Buffett, the…

Read More »

Insurance ETF Poised for an Elliott Wave Correction

The SPDR Insurance ETF reached a new all-time high in September, helped by a solid job market, increasing wages and rising consumer confidence. The price is up 630% since the Financial Crisis low at $4.77 in March 2009. The question is, can investors trust the uptrend to continue? Regardless of what pundits say, we don’t…

Read More »

Dow Jones Sends a Warning Investors Can’t Ignore

The price movements of financial instruments form repetitive patterns, called Elliott waves. Experienced analysts try to recognize those patterns in order to prepare for the next market move. Sometimes, a pattern can indicate not only one, but the next two consecutive moves. The triangle pattern, for instance, is known to precede the last wave of…

Read More »

DAX 30 Adds to Global Recession Fears

The German DAX 30 index has been declining since early July when it reached 12 656. Last week’s news that the German economy shrank by 0.1% in the second quarter only added to global recession fears. The benchmark index of Europe’s largest economy fell to 11 266 on August 15th. Are investors’ concerns warranted? Or…

Read More »

Dare to Guess the Best Stock Market Index of 2019?

The first half of 2019 saw stock market indices around the globe rebound sharply. In the U.S., NASDAQ, DJIA and the S&P 500 are up 22.7%, 14.8% and 18.9% since the start of the year, respectively. In Europe, the German DAX and France’s CAC 40 both climbed 17.8%, UK’s FTSE 100 surged by 12% and…

Read More »

More analyses