Market Thinks it is October 1998 All Over Again

In 1998 the S&P Index dropped 22 percent from a July high to an October low.  Then went on to make a new all time high in November.  This was during the Russian and Brazilian plus Long Term Capital Management meltdowns. What was different however, was that Greenspan lowered interest rates three times during that 4 month period.  In 2015 we cannot get an interest rate decline, and probably will see an increase.

In the meantime the S&P, now that it has gone through the 1950 macro swing point, will probably trade around in a compressed area of the macro 1860 – 2040 range, a relatively tight 1960 to 2030 micro range with a 1995 micro swing point.