History Says A Big Move Is Coming For Stocks

wall-street-etfChris Ciovacco:  The chart of the NYSE Composite Stock Index below shows equities have been indecisive since the second half of 2013.

The lack of sustained progress in either direction tells us the battle between the bulls and bears has been fairly evenly matched.

1993-1995 Bullish Example

A similar indecisive period took place in the mid-1990s.

Periods of consolidation are often followed by big moves once the market “breaks out of the box”. In the 1993-95 case, the resolution was to the upside.

2006-2008 Bearish Example

A similar period of indecisive investor behavior took place between the fall of 2006 and summer of 2008.

Harder markets are typically followed by easier markets. In the 2006-08 example, the easier market produced a strong and discernible bearish trend.

S&P 500 Moving To 2,340 or 1,680?

This week’s stock market video examines the current period of indecisive investor behavior, including some visuals on what a break to the upside and downside might look like.

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