The odds are “zero” that the selloff in the S&P 500 Index is over, said Carter Braxton Worth, technical analyst at Cornerstone Macro. The S&P 500 has dropped 5.8% last week, and 7.5% from its record close of 2,130.82 on May 21. Meanwhile, the Dow Jones Industrial Average closed Friday 10.1% below its May peak. He gives a number of reasons for his belief: A) the fact that many important stock leaders, such as Amazon , Netflix , Starbucks and Google , “succumbed so aggressively last week is a very serious development and one that is virtually impossible to reverse on an intermediate basis; B) certain banks, brokers and certain “impervious” healthcare stock broke down; C) the fact that there was no let up in selling of the sectors that were already beaten down, such as energy , industrials and materials is a big concern; D) there have been 211 corrections in the S&P 500 of 5% or greater since 1927, and the mean decline is 12.11%, so “once you’re down more than 5% you end up going down further, more often than not. S&P 500 futures shed 2.8% in recent trade.
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