NEW YORK, Aug 20 — The rebound in US stocks is gaining believers among investors who study market trends, bolstering hopes for equities in the second half of 2022.
The S&P 500 closed down about 1.29 per cent yesterday, ending a streak of four straight weekly gains. That trend has reversed recently. The number of new highs on the New York Stock Exchange and Nasdaq surpassed new lows last week for the first time this year on a weekly basis — an encouraging sign to Delwiche and other strategists.
“The probability that we are higher in a year is much higher with that flashing,” said Todd Sohn, technical strategist at Strategas. Some indicators do not support more gains. Analysts at BofA Global Research said that stocks have historically bottomed when the sum of inflation and trailing price/earnings was less than 20. That number currently stands at 28.5, the bank wrote on Wednesday.