Chart of the Day - Wednesday, April 22nd, 2020

Today's Chart of the Day was shared in a research note by Frank Cappelleri of Instinet (@FrankCappelleri). It's a bar chart of the S&P 500 index over the past four months. In the note, Frank explains - "The SPX’s 31% rally hasn’t even tagged the 61.8% retracement level yet. From this perspective alone, any counter-trend move that peters out shy of that mark remains just that - a counter-trend move taking place within a bigger dominant (down) trend." Technicians often use key Fibonacci retracements levels like 38.2% and 61.8% after a big decline in order to identify potential inflection points. According to Fibonacci analysis, this is simply a bear market rally until price proves otherwise by retracing over 61.8% of the February-March decline.