CNBC’s Jim Cramer created a playbook for investors on Monday in case the S & P 500 recedes from highs.
“If history is a guide, next week will be ugly,” he said.
The “Mad Money” host made recommendations after reviewing the chart analysis from renowned technician Larry Williams.
“If you’re an agile trader, you might want to sell your S & P at the opening next Monday and replace it near the weekend,” Kramer said. “Even if you’re not that agile, be aware of your weaknesses, as it can create great buying opportunities.”
The S & P 500 finished its session on Monday at 4,255.15 and recorded three record closings in the same number of days. Williams, who has a habit of finding seasonal patterns, warns of a “late June plunge,” Kramer said.
Stock prices tend to be hit near the end of the month, whether it’s a slight or significant fall, Williams said. Kramer said he would not oppose the prediction.
Last year, the index fell almost 5% from top to bottom between June 23 and June 26.
“According to Williams’ analysis, next week’s market shorts have been a good strategy for at least the last 22 years,” Kramer said. “Remember that when S & P begins to collapse, you are facing a strong seasonal trend. You want to start bottom fishing.”
Kramer emphasized that the seasonal pullback could be followed by another pattern that Williams calls Independence Day.
Last year, the S & P 500 bounced from less than 3,000 in late June and rose more than 6% by July 10.
Kramer says a “late June plunge” could create equity opportunities
Source link Kramer says a “late June plunge” could create equity opportunities