This single indicator has properly planned that the S&P 500 reference would move 18 times out of 18 times since the beginning of 1945.
For more than a century, Wall Street has been a machine with wealth. Although other asset classes have succeeded in helping investors develop their nominal wealth, including real estate, bonds and raw materials such as gold and oil, nothing has approached remotely to match the annualized yields of shares over long periods.
But just because Wall Street is unequaled in the long -term annualized return column, this does not mean that actions are not sensitive to periods of instability.
In the past two months, the Industrial average Dow Jones (^ Dji 0.05%))Benchmark S&P 500 (^ GSPC 0.74%))and propelled by growth Nasdaq Composite (^ Ixic 1.26%)) have all refused two -digit. The first two fell on a correction territory, the composite of the Nasdaq officially entering the bear market on April 8.
We also attended historical volatility episodes in April for these main stock market indices. For example, the S&P 500 endured its fifth largest decrease in percentage of two days (10.5%) in 75 years of the closing bell on April 2 at the end of April 4, as well as its biggest point gain in history on April 9.
Image source: Getty Images.
When actions flicker wildly and / or the abandonment of the elevator, it is normal for investors to search for forecast tools or data points that could offer an overview of the place where the main Wall Street indices are headed. Even if no predictive tools exist which can guarantee what will happen next, a small number of metrics and events have strongly Correlated with higher or lower movements in Dow Jones, S&P 500 and Nasdaq composites through history.
On April 24, one of these rare events of Wall Street was only triggered the 19th time since the beginning of 1945, and he (so far) has an impeccable experience of forecasting management actions which will then move.
Fear and uncertainty govern the perch to Wall Street (for the moment)
Before examining this exceptionally rare event which should make a big smile on the faces of investors, let us first tackle the variables that prompted fear and uncertainty that led to nominal oscillations and in historical percentage in the DOW, S&P 500 and Nasdaq since the beginning of April.
We can say that the greatest catalyst of the supercharged volatility of Wall Street was the price policy of President Donald Trump. On April 2, Trump announced a global rate of 10% and introduced higher “reciprocal prices” on a few dozen nations which historically executed trade deficits with America. These reciprocal prices are on a 90 -day break (April 9) for all countries except China. Although the president’s objective is to increase income, protect American jobs and make American goods more competitive with those who are brought abroad, there are many things that can go wrong.
Wall Street ‘main stock market indices have been strongly fidied in the wake of Trump’s pricing announcements. ^ Dji given by Ycharts.
For example, there is the potential that the inflation rate prevailing to react. Investors have applauded a drop in advanced northern inflation rates from 9% in 2022 to less than 3% currently. But with the lack of clarity of the Trump administration between the rates of contributions and the production rates, additional rights on the first run the risk of increasing prices and making national products less competitive with those imported from overseas.
In addition, the president and his team failed to present a coherent message. Everything, goods subject to prices at the rate rates themselves, has changed regularly. A lack of transparency is undoubtedly disturbing investors.
The stock market has also been a giant due to concerns about the increase in long -term treasure bond yields (10 years and 30 years), as well as American economic prospects.
Although the highest treasure bond yields put a smile on the faces of conservative investors and income research, they also indicate that the cost of the loan increases. The higher loan costs are generally a brake on consumers and businesses.
Meanwhile, the GDPNOW forecasts of the Atlanta Federal Reserve provide a 2.5% contraction In the American economy during the first quarter, from an update of April 25. The last time the US economy endured such a strong economic drop in a non -convent pandemic district, it was at the end of the big recession in 2009.
Image source: Getty Images.
This unique event has a 100% success rate in the forecast of future stock movements
To be clear, there is no calendar as to the uncertainty linked to the price and the American economic prospects will become more transparent. Trying to predict short -term movements on stock markets according to daily titles is nothing more than a game of riddles.
But from time to time, a correlative event presents itself which has such a high success rate of forecasting future action movements that investors would be imprudent not to pay attention.
On April 24, a technical indicator developed by stock market analyst at the end of Martin Zweig, known as Zweig Lampth Thrust (ZBT), only triggered the 19th time in the past 80 years. The extent of the extent of Zweig is an indicator focused on market dynamics which measures the ratio of advanced actions to the total number of advanced and declining shares (which is commonly called “market width”).
Zweig’s width thrust is triggered when there is a rapid advance in actions, which, as history has shown, often occurs near the lower elevator movements in the Dow, S&P 500 and Nasdaq composite. The ZBT generally points out when the mobile average 10 days from the progress of stocks on the New York Stock Exchange goes from less than 40% north of 61.5% in 10 days of negotiation or less, and the volume also climbs.
But what really stands out is the performance of the S&P 500 benchmark following these ZBT triggers.
Why is ZWEIG’s extent important?
Since the Second World War, it occurred 18 times and the S&P 500 has never been less than 6 or 12 months later.
And believe me, when they have triggered in recent years, many have made fun. pic.twitter.com/wbt1t0ewm5
– Ryan Detrick, CMT (@ryandetrick) April 24, 2025
As you can see in the position above of the Carson group’s market in chief market, Ryan Detrick on the social media platform X, the ZBT reported positively 18 times since the beginning of 1945, April 24, marking the 19th occasion. In brands of six months and 12 months after the ZBT trigger, the S&P 500 was higher at 100% of the time (18 for 18)!
To rely on this point, the S&P 500 did not simply provide historically average gains after the triggers of the extent of Zweig. The average yield of 12 months was 24%, which doubles more than the average annualized performance of the long -term S&P 500, which is closer to 10%. In other words, the extent of the extent of Zweig has a talent to point out the start of a new bull market or the continuation of a significant correction.
Admittedly, technical indicators cannot hold a candle for real bread and butter from what makes companies vibrate: their operational results. Ideally, the growth in business profits and a favorable environment for companies to hire, innovate and acquire will provide a solid base for the Dow Jones, S&P 500 and NASDAQ composite to direct.
Nevertheless, the ZBT provides another example of optimism and time being the greatest allies of investors. Regardless of how large titles may seem on short deadlines, long -term growth in the American economy and public companies that benefit from a constant expansion economy give the impetus to push actions to new heights.
