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S&P500 Snapshot: Monday Meltdown!

  • Written by Syndicated Publisher No Comments Comments
    May 15, 2012

    The S&P 500 plunged at the open and hit its intraday low near the end of the first hour of trading, off 1.24%. There were no economic indicators to distract the markets from the ongoing Greek drama and JPMorgan’s travesty of professional trading. After a feeble attempt at recovery, the market backslid in the final two hours to close a bit off the intraday with a loss of 1.11%. The VIX ended the day above 20 at 21.87, the highest daily close since January 17th. Year-to-date the index is up 6.42%, which is 5.69% off its interim closing high set on April 2nd.

    From an intermediate perspective, the S&P 500 is 97.8% above the March 2009 closing low and 14.5% below the nominal all-time high of October 2007.

    Below are two charts of the index, with and without the 50 and 200-day moving averages.

     

     

     

    For a better sense of how these declines figure into a larger historical context, here’s a long-term view ofsecular bull and bear markets in the S&P Composite since 1871.

    These charts are not intended as a forecast but rather as a way to study the current market in relation to historic market cycles.

     

    Images: Flickr (licence attribution)

    About The Author

    My original dshort.com website was launched in February 2005 using a domain name based on my real name, Doug Short. I’m a formerly retired first wave boomer with a Ph.D. in English from Duke. Now my website has been acquired byAdvisor Perspectives, where I have been appointed the Vice President of Research.

    My first career was a faculty position at North Carolina State University, where I achieved the rank of Full Professor in 1983. During the early ’80s I got hooked on academic uses of microcomputers for research and instruction. In 1983, I co-directed the Sixth International Conference on Computers and the Humanities. An IBM executive who attended the conference made me a job offer I couldn’t refuse.

    Thus began my new career as a Higher Education Consultant for IBM — an ambassador for Information Technology to major universities around the country. After 12 years with Big Blue, I grew tired of the constant travel and left for a series of IT management positions in the Research Triangle area of North Carolina. I concluded my IT career managing the group responsible for email and research databases at GlaxoSmithKline until my retirement in 2006.

    Contrary to what many visitors assume based on my last name, I’m not a bearish short seller. It’s true that some of my content has been a bit pessimistic in recent years. But I believe this is a result of economic realities and not a personal bias. For the record, my efforts to educate others about bear markets date from November 2007, as this Motley Fool article attests.

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