Telegram

Despite COVID-19 Uncertainty, Don’t See Retest of Market Low

May 15, 2020
Despite COVID-19 Uncertainty, Don’t See Retest of Market Low

The most obvious reality regarding the coronavirus (COVID-19) outbreak is that nearly everyone would agree there is much uncertainty. There is no playbook for a pandemic. And 10-, 20- and even 50-yr datasets are not so useful, because they encompass exactly zero similar episodes. The two biggest uncertainties are 1) the path of the healthcare crisis: When will it end? When is the vaccine/cure coming and will there be a second wave in the Fall? 2) Will consumers ever return to a restaurant, movie or concert? How much damage has been wrought? What is the new normal?

Nevertheless, there are five things (+a bonus) that are "certain": This isn’t a normal business cycle; federal policymakers have acted with lightning speed; the bond market is functioning well; consumers are emerging from their bunkers, though the speed is unknown; and we are certain everyone is "uncertain," right? Bonus: the Standard & Poor’s 500 index (SPX) has retraced 50% of its losses, and since 1929 in the 10 declines >30%, a 50% retrace has eliminated a retest of the low.

You are trying to access FSI member-only content.
You need to have an active FSI Macro, or FSI Pro subcription in order to read this article.
If you are already a member at FS Insight, please Sign In here. If you don’t have a subscription to FS Insight yet, you can sign up below.

Choose one of our yearly plans to save nearly 20%

We accept crypto via BitPay for yearly subscriptions.
    • Macro
      FSI Macro
      from
      $
      169
      /mo
      billed anually
      Get access to all the macro research on FS Insight
      • Tom Lee's Live Market BLASTs
      • View from Tom Lee
      • Signal From Noise
      • Portfolio Strategy
      • Technical Analysis
      • Granny Shots – Stock Ideas
      • US Policy
      • Live Conference Calls with Q&A
      First Month Free!
    • Crypto
      FSI Digital Assets
      from
      $
      79
      /mo
      billed anually
      Get access to all the crypto research on FS Insight
      • Tom Lee's Live Crypto BLASTs
      • Tom's Take on Crypto
      • Crypto Weekly Newsletter
      • BitDigest Daily Newsletter
      • Crypto Technical Analysis
      • Benchmark Indices Review
      • Bitcoin Valuation & Misery Indexes
      • Live Conference Calls with Q&A
      First Month Free!
    • Macro + Crypto
      FSI Pro
      from
      $
      219
      /mo
      billed anually
      Get access to all the exclusive research on FS Insight
      • Looking at code?
      • I am hidden!
      • FSI Macro
      • +
      • FSI Digital Assets
      • Designed by
      • HANGAR115
      • -
      First Month Free!
Disclosures (show)

Don't Miss Out
First Month Free

first 500 users only