50 days in, this rally is just like...

Taking a look at similar rallies

The rebound off the June lows has been just like the one in 1962.

Based on the behavior of short-, medium-, and long-term participation in the rally off the bottom, the current rebound has been closest to 1962. Out of all the highest-correlated rallies, there were several failures but most went on to long-term gains.

Now, let's look at the price action in the S&P 500 itself, not the performance of its individual stocks. We looked at the S&P's price return in the 50 days following the June low, compared to the 15 rebounds from a low that had a correlation of more than +0.55 (out of a scale from -1.00 to +1.00).?The initial shot off the low tends to run out of steam around day #50 and last through day #90.

If we filter the table to show only the most similar rallies to the current one, those with a correlation above +0.85, returns over the next year were impressive. The chart below shows that those rallies tended to peak right where we did this time...

What the research tells us

• The 50-day rally off the June low is comparable to other long-term bottoms.
• A price analog shows that the highest-correlated 50-day patterns all showed one-year gains.
• Shorter-term returns were inconsistent, with several giving back most or all of the initial rally.
• The highest-correlated rallies tended to peak where we did now but showed long-term gains.

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The S&P 500 and other indexes continue to retrace the multi-month surge from the June low. The world's most watched benchmark reversed from a 42-day high (close) to a 21-day low (close) in only eight sessions.

We assessed the S&P 500 outlook when the index reverses from a 42-day high (close) to a 21-day low (close) in 15 or fewer sessions during a protracted downtrend. The results were not great, suggesting a potentially rough September.

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Platinum is about to enter its weakest seasonal period of the year.?The period will begin with price already in an established downtrend. This is often - though notably, not always - a powerful bearish setup.

Historically, platinum has traded higher 40% of the time during this period - however, the down years have tended to be significantly worse than the up years.

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