The Nasdaq is almost all the way back
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Jason Goepfert
Published: 2020-06-05 at 11:00:00 CDT
The Nasdaq Composite has almost fully made back all of its losses. After falling more than 30% from its 52-week high, the tech-heavy index has almost retaken that high, pulling within 1.5% by Wednesday. This is, by far, the fastest turnaround in its history.
By the time the index cycled from more than 30% below a 52-week high to within 1.5% of it, as it did on Wednesday, it never failed. It closed at a fresh 52-week high within three weeks every time. Even when looking at smaller 20% drawdowns, it also never failed.
The Nasdaq has also enjoyed a "golden cross", a mostly ineffective signal that gets a lot of attention regardless. The curious thing about the current cross, when the 50-day moving average rises above the 200-day average, is that it triggered when the Nasdaq was already so close to an all-time high.
That didn't seem to dampen its forward returns much. It was not a great buy signal, but it was not a consistent reason to sell, either.
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We also looked at:
- A closer look at what happens when the Nasdaq recovers from big drawdowns
- Not a single domestic or overseas index, ETF, bond, or commodity we follow is showing pessimism
- More than 35% of the funds we follow currently show optimism
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- One of the "Sharpest" Rallies in 60 Years Is Rolling Over
- A Sharpe Rally Thrusts Stocks Into Historic Territory
- The Most Important Index in the World Has Doubled - Now What?
- As Stocks Double, A Record Run with Record Low Participation
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The post titled The Nasdaq is almost all the way back was originally published as on SentimenTrader.com on 2020-06-05.
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