Randy Frederick from Charles Schwab expects a 5%-10% pullback as the S&P 500 chart shows similarities with the 2009 trend before the market rally continues towards the 3,386 all-time high.
Key quotes
“I would watch the 3,137 level as the first downside support. Below that I would focus on the 200-day SMA (now at 3,007). On the upside, the all-time high of 3,386 now looks like it could be reached within the next few weeks.”
“I would not be surprised if the S&P 500 experiences a 5% to 10% pullback before this is all over. And as the current trend remains remarkably similar to 2009, we could be due for it at any time. The S&P 500 fell 7% from 6/12/09 – 7/10/09, before the recovery continued.”
“From a growth standpoint, Q1 EPS was -7.7% y/o/y; Q1 revenue was +0.9% y/o/y. This compares to +0.6% and +3.4% respectively in Q4.”
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