The SPX has recently broken out from its 2022 downward sloping trendline. I decided to review the last 100 years of data to spot similar breaks outs. Here’s what I discovered. There have been several failed breaks — in 1940, 2002 and 2008 — that actually resulted in the SPX price reaching a new low. In all of those cases, the price started to fade almost immediately after the break outs happened. In cases when the price didn’t fade and continued moving higher, it eventually reached new ATHs.
So, here’s the current break out. And below, I am posting examples of the successful and failed break outs from the last 100 years. All charts are based on weekly candles.
2023 Break Out
Breakouts that led to new ATHs
2012
1982
1971
1967
1961
1954
Breakouts that failed
2008
2002
1940
thank you very much for sharing the history. Let us which side markets will go.
Nice charts! Does it mean trendlines have no reliable predictive power? (any statistics on that?)
Very nice research. I note the gradient of the slope is quite indicative. of the ones with a steeper slope, 4/5 made lower lows. Of the ones that made a higher high, all made higher highs but one.
Thank you for great analysis
Thank you for sharing thasa charts