Wild Swing Anniversary - Shakeout Coming?

The above chart shows the period around September 18 and 19 last year. On those two days, the SP500 experienced a swing of 11.6% from low to high. Oftentimes there is a repeat or an echo of significant swing points one year later. I am not saying that we will see the same kind on extreme swing. Actually I doubt it because those tend to happen in bear markets not bull markets, but nevertheless we could see a shakeout attempt later in the coming week. If it happens, the key will be to sit on your hands. One big down day will probably not change the trend from up to down. We would need to see follow-through and continuation to the downside. So, if we do get a shakeout, expect an equally surprising reversal to the upside. If that doesn't happen, we will re-evaluate.