Despite the bullish market waves, the S&P 500 now stands at a precarious threshold, with the index about to face a potential correction. Notable firm Raymond James has sounded the alarm, adding how the markets may enter a corrective phase soon, with the index tanking up to 10%.
S&P 500 Future: Tanking First to Rise High Later?
Raymond James Financial Inc. has shared a new ominous prediction, sharing that the S&P 500 index is on the verge of encountering a price dip. The firm now expects the index to enter a corrective phase soon, driven by mechanical sell triggers activated last week
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Javed Mirza, MD, Raymond James, shared how the equity markets are entering into a corrective era lasting up to 1-3 months, with a downside potential of 8% to 10%. However, Mirza was quick to add how this could be a lucrative buying opportunity for investors, making it a price dip worth looking forward to.
“S&P 500 ENTERING CORRECTIVE PHASE, COULD FALL 8-10%: RAYMOND JAMES. Raymond James warns that the S&P 500 may drop 8–10% over the next three months… While any short-term bounce is expected to stall near the 50-day moving average. Mirza views the pullback as a potential buying opportunity in tech, industrials, and basic materials.”
The Future Highlights: Current Values Shaping the Future of the Index
Despite the murmurs of a potential correction taking over the S&P 500, the index has been performing quite well, busy erasing errors of the last value dips.
Per the latest post by the Kobeissi Letter, the S&P 500 has already risen by 250 points, erasing losses of its latest Friday low value threshold. If the index continues to follow the same trajectory, then it may very well be able to recover from its projected corrective phase.
“Last week’s market “crash” has been erased. The S&P 500 has now added +250 POINTS. Since Friday’s low and is now ABOVE the November 20th high before the “crash.” That is +$2.1 TRILLION in market cap in less than 3 trading days. And this puts the S&P 500 just 2.2% away from entering new all-time high territory. The reality is that the AI Revolution has only become larger. The Fed is cutting rates into a HOT market, and smart investors want more assets. If you can eliminate the noise, this market becomes incredibly profitable.”