CNBC’s Jim Cramer told investors that confidence in the ability of the market to recover after Wednesday’s fall should not be lost.
“History is very clear. It shows that you have to keep the course. The S & P500 has already succeeded in retracement of 50% of its huge decline, and 21 times since the Great Depression. So that means the decline ends every time, “he said, saying the average went back 50% of the decline since November since yesterday.
“Is this different? Of course, don’t ignore the very realistic possibility that good things can happen,” he added.
The host of “Mad Money,” who warned investors of unjustified optimism on Tuesday, quoted information from legendary market engineer Larry Williams for an analysis of the future course of the market. Cramer has relied on Williams’ analysis to make market forecasts in the past.
In addition to the patterns Williams discovered, Kramer cited several factors that suggest that the market may recover.
He also noted the recent rate hikes of the Federal Reserve Board, Fed Chair Jerome Powell’s strong comments on inflation, and the Covid-19 pandemic, which may soon end as an additional market factor.
“This is a cruel environment with lots of really terrible possibilities. You wouldn’t be surprised if tomorrow is worse than today …. But in the extreme fate and dark moments we saw today, bears need to be remembered. There is, maybe wrong. “