What investors should expect over the coming months: Abrupt swings to the upside for the S&P 500 within the context of a bear-market correction, further downside in oil prices in the first quarter, weakness in the US economy and fewer rate hikes from the Federal Reserve.
Technical indicators from the last four bear markets to ravage US equities suggest that a correction of at least 20 percent could be in store for the S&P 500. At this juncture, the risk of a US recession remains low, which should limit the coming bear market's severity and duration. However, we'll continue to monitor our favorite economic indicators for deterioration.
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