Market Rally Driven by Trump’s Tariff Pause Raises Bullish Speculation
The recent market rally, with the S&P 500 experiencing its largest increase since 2008 and notable gains in bitcoin and the CoinDesk 20 index, was driven by President Trump's 90-day tariff pause announcement. Analysts from Goldman Sachs caution that such rallies are common in bear markets.
- Goldman Sachs notes that bear market rallies often occur, lasting an average of 44 days with returns of 10% to 15%.
- There have been 19 global bear market rallies since the 1980s.
- Historical data shows major double-digit rallies can happen even in severe bear markets.
Callum Thomas from Topdown Charts remarked on the potential for the current rally to be a bear market rally (BMR). Key indicators for a sustained market bottom, including attractive valuations and policy intervention, are not yet present.
- The Federal Reserve is unlikely to provide immediate support.
- Trade tensions may rise again after the 90-day tariff pause.
- Current stock evaluations remain high.