Rare S&P 500 Pattern Could Signal Double-Digit Gains in 2023 Despite Recent Losses
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The S&P 500 rallied for 5 straight months this year, followed by 3 consecutive months of losses - a rare pattern that could signal double-digit gains next year.
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This pattern has only occurred 4 times since 1926, and each time the S&P 500 gained a median 12% over the next 6 months and 21% over the next 12 months.
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In 1975 and 2016 when this pattern occurred, the S&P 500 gained 22.5% and 12.1% respectively in the 6 months that followed.
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At 39 days, the current losing streak is the longest on record for this pattern, so the market has work to do to avoid being the first negative case.
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Though stocks are struggling lately, bullish forecasts predict the S&P 500 could retest all-time highs by end of 2023 if the Fed turns more dovish.