Eseandre Mordi
The S&P 500 recently finished three weeks in a row where the price increased by 3 % or more. In the last 76 years, this specific sequence occurred only three times before, , according to Anthony Pompliano.
The S&P 500 has seen 3 consecutive weeks with at least a 3% gain.
As a matter of history, this rate of increase is very uncommon and usually significant. This has only happened 3 times in the last 76 years.
The events that took place in 1982 and 2020 are the previous two times this happened. On both occasions, the direction of the market cycle changed and long periods of rising prices followed.
The first two launched some of the most powerful bull runs in American history.
By looking at data on past performance, the importance of this event is clear. Average return was 33% over next 12 months.
What It Could Signal
For those who track the market, this pattern suggests that the mood of investors is changing. It is a sign that people are moving money out of safe assets and into assets that carry more risk. When prices move this fast, it happens near a major change in direction - this indicates that a new period of growth might be beginning instead of a current trend ending.
And this observation matches the way the market is organized now. The index is continuing to rise and is getting close to a level where selling often increases, which is mentioned in.
At the same time technical factors like investors buying back borrowed shares and others buying because prices are rising can make the move larger. If the market stays strong in the weeks that follow, it will confirm this change. Due to the factors, the market is currently in a state where prices are moving upward.
Eseandre Mordi
