@SubuTrade highlights a rare V-shaped recovery in the S&P 500, surging 18% from a low on April 7, 2025 to a new high by June 27, 2025, a pattern historically linked to strong gains, with data from 11 past instances showing an average 1-month gain of 2.0% and a 3-month gain of 6.9%, though outcomes vary widely (e.g., -8.1% to +17.7%).
This rebound aligns with unexpected US-China trade talks resuming in May 2025, reducing tariffs from 145% to 30% and lifting export restrictions on rare earth minerals, a move that boosted market confidence despite initial fears of a recession, as reported by Reuters on June 27, 2025.
Historical analysis of similar recoveries suggests caution, as a 2020 study in the Journal of Financial Economics found V-shaped rallies often precede volatility, with a 30% chance of a correction within 6 months, challenging the bullish optimism.
Reference:
SubuTrade (June 27, 2025) - S&P 500 after it rallies 18% to a 1 year high within 3 months.
SubuTrade (June 27, 2025) - S&P 500 after it rallies 18% to a 1 year high within 3 months.