CNBC’s Jim Cramer told investors that Tuesday’s market recovery could be the start of a long rally.
“The charts, as interpreted by veteran Larry Williams, suggest that Wall Street has finally thrown the towel and that some powerful seasonal patterns are ultimately in favor of the bulls. I wouldn’t be surprised if he is correct again, whose means maybe the bottom is really, “”mad Moneysaid the host.
All major averages closed for the day on Tuesday as investors bet that the markets will bottom out after heavy losses this year due to persistent inflation, Federal Reserve interest rate hike, Russia-Ukraine war and the Covid lockdown in China. has gone.
“We’re back on track today with that monster … rally. And, as Williams sees it, it could be just the beginning,” he said.
To explain Williams’ analysis, Cramer first examined the weekly chart of S&P futures going back to 2018.
On the chart is the Williams Panic Indicator, owned by a market technician, that shows when investors sell their holdings in a draw, according to Cramer.
“When you get a massive sell-off like this, the Williams Panic Indicator will throw a buy signal, and historically it’s been a great time” to do some buying, he said.
He added that the indicator showed a buy signal on June 17, which has happened only 18 times in the last 90 years. “Almost every time, you had to jump up,” he said.
“So we’ve got dedication. But just dedication isn’t enough – you also need something that can turn things around, and right now Williams thinks we have time,” Cramer said.
For more analysis, see Cramer’s full explanation below.