Gann Global Financial

The S&P 500 pushed up toward the 800 level and the probabilities favor that 665.70 is a very significant low.

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Here’s what I say with regard to what has taken place this last week-and-a-half. In eight trading days, the market has retraced 50% of the decline off the January 5th high.

Due to the abbreviated length of the leg down off the January high and the price point at which this market reversed to the upside breaking to the 665.70, I view the forecast of the near term direction of this market as being problematic.

In other words, I’m having trouble in fitting this situation into the historic precedent of the Great Depression. Additional trade will provide clarity so at this point I have to take a neutral approach in the stock market.

Obviously, there is going to continue to be tremendous volatility but we did expect the ideal that the market would push down to the 600 level. Ideally, into the second week of April, and the market did not accommodate that so now after a 29% decline in a relatively short period of time, we’ve seen the market spike up very significantly.

It’s going to be very interesting to see how this plays out. Additional trade will provide clarity, which is to say that we will get insight into what is taking place in this market, so right now, I would have to say, in terms of a trading type situation, I’m definitely neutral and watching very closely with regard to long-term ramifications that this has for overall forecast as to the length of this bear market.