S&P 500 - At critical historic support/resistance from the 1940s
Log chart of S&P 500. Historic support / resistance levels indicate that if 3650 level is broken the next two legs down are at ~2900 and ~2500 respectively. The second leg down at 2500 would indicate about 47% from the top and could mark the end of the bear market. Note, we are still relatively early in the bear market at 365 days. The Dot Com fall lasted 763 days and the more recent Financial Crisis in 2008 lasted approximately 518 days prior to market sentiment shifting. Believe the index is most likely to break current support levels and test the 2900 level considering the global context.
Not financial advice.
Why use log chart:
"While S&P 500 data to linear plot scale is good for analysis of a span of 2 or 3 years, beyond that a logarithmic S&P 500 chart is best. This is because it gives the same Y or vertical displacement for a certain percentage move up or down regardless of date. Moreover, a fixed compound interest percentage gain plots as a straight line on a logarithmic chart, which is very useful as the human eye is very good at judging and comparing data positions above and below a straight line (versus the linear plot's exponential curve for same)." Ref. Wikimedia for original source.
Not financial advice.
Why use log chart:
"While S&P 500 data to linear plot scale is good for analysis of a span of 2 or 3 years, beyond that a logarithmic S&P 500 chart is best. This is because it gives the same Y or vertical displacement for a certain percentage move up or down regardless of date. Moreover, a fixed compound interest percentage gain plots as a straight line on a logarithmic chart, which is very useful as the human eye is very good at judging and comparing data positions above and below a straight line (versus the linear plot's exponential curve for same)." Ref. Wikimedia for original source.
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