Similar 1978 October Massacre Averted from Fed's $38B Pumping
The feds may have averted a repeat of the October 1978 chart pattern, where the S&P dropped 15%, the $38B pumping last week seems to have broken the unhealthy pattern, at-least for now.
The 1978 october chart pattern is no longer on the radar -- you may recall it from last time. The two month chart is at 61% probability of an uptrend, up from the bearish 53% last time. The general short term health of the market has also improved.
From observing the similar chart patterns, it seems oil, Dow, and the S&P 500 will trend up, while gold will trend down. The analysis is broken down by oil, gold, Dow, and S&P 500. Their probability of an uptrend is recorded under the time frame (1 month, 3 month, and 6 month) column. The stocks were randomly picked.
| oil | 1 Month | 3 Month | 6 Month |
| cvx | 71% | 76% | 84% |
| xom | 78% | 61% | 84% |
| bp | 69% | 69% | 84% |
| gold | 1 Month | 3 Month | 6 Month |
| bvn | 69% | 61% | 36% |
| gss | 69% | 72% | 60% |
| tgb | 30% | 23% | 30% |
| dow | 1 Month | 3 Month | 6 Month |
| ^djia | 69% | 92% | 69% |
| S&P 500 | 1 Month | 3 Month | 6 Month |
| ^gspc | 50% | 76% | 84% |