IStockphoto The bulls are back in the stock market again.
And just like that, the bulls came charging back.
All it took was one stellar economic data point to change the stock market’s mood and punt the indexes higher. But even before the robust jobs numbers exorcised the demons, strategists had started to predict that the market is gearing up for a comeback given the depth of the recent selloff.
“We expect a bear market rally to develop over the coming weeks, and we expect a new bull market to develop over the coming months to quarters,” said Ari Wald, a technical analyst at Oppenheimer & Co.
Wald believes the recent spate of weakness is the cyclical bear market waking up in the midst of a secular bull market and suggested that the selling pressure will soon work itself out.
Oppenheimer & Co.
“On average, the index drops 20% over an 8-month period and retraces 50% of the prior advance,” he said. “This is why we believe the S&P 500 has endured the bulk of the magnitude and now requires time to base.”
The strategist forecast the S&P 500 to trade in a range of 2,375 to 2,700 for 2019.
The stock market closed out the first week of 2019 on a positive note, with the S&P 500 SPX, +3.43% rising 1.9%, the Dow Jones Industrial Average DJIA, +3.29% climbing 1.6% and the Nasdaq COMP, +4.26% rallying 2.3%, thanks to the strong jobs data which assuaged concerns of a slowdown in the U.S. economy and laid to rest fears about a looming recession.
Tobias Levkovich, chief U.S. equity strategist at Citi, who trimmed his 2019 target for the S&P 500 to 2,850 from 3,000, believes this is a good time to jump back into the market, in