we may soon see a deadly accurate indicator, that the market is about to melt to the downside, just as it has each time this has happened in the past several decades.
Don’t Miss This POWERFUL Recession Analysis!
This chart is a comparison of the initial jobless claims in the US, to the E-Mini S&P500 futures contract.
Unemployment claims are in blue and the S&P500 is in pink. You can see that there are two moving averages that are following the unemployment chart.
They are the 25 MA (in orange) and the 100 MA (in green.) FYI, I began with the 50 and 200 MAs, but I cut them in half to shorten the crossover time.
Looking at the chart, we can see that each time a bullish crossover occurred (red vertical trend lines ) between the 25 MA and the 100 MA unemployment skyrocketed, and a recession kicked off at the exact same time.
The first bullish crossover on this chart occurred in October of 2000. From there, unemployment ripped higher, and the S&P500 collapsed as a result of the dot com bubble.
Then, we saw another bullish crossover of the 25 and 100 week moving averages for the unemployment chart, and unemployment skyrocketed again. That occurred at the exact top, just before the stock market melted for the 2008 recession.
Now, here we are today, with unemployment at historically low levels. You can see that the 25 MA is curling up toward the 100 like it wants to cross over.
It hasn’t crossed yet, but we could see a bullish unemployment cross in the near future.
That means that we may soon see a deadly accurate indicator, that the market is about to melt to the downside, just as it has each time this has happened in the past several decades.