DNY59
Key points
The recent selloff in the S&P500 (SP500) is likely the beginning of the recessionary bear market. This means that, in my opinion:
- the S&P500 wall fall in excess of 20%, and
- the economy will slip into a recession.
S&P500: It's The Beginning Of The Recessionary Bear Market
Summary
- The S&P500 had a major technical breakdown, which suggests a change of trend.
- The GDPNow estimates that personal consumption is stalling, which is a clear signal of a recession.
- Thus, the S&P500 is in the early stage of the recessionary bear market, where the total drawdown is likely to exceed 20%.
Commodity Trading Adviser (CTA), member of National Futures Association. Professor of Finance, research on Global-macro issues. Editor-in-Chief, Journal of Corporate Accounting and Finance.
Analyst’s Disclosure:I/we have a beneficial short position in the shares of SPX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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