Stock market today: S&P 500, Nasdaq clinch records as chip stocks ride AI momentum
The head of HSBC's (NYSE:HSBC) Technical Analysis group just issued a major warning.
Unless the markets can take out its September highs, we could very well see a repeat of the 1987 Crash.
Murray Gunn is head of technical analysis for HSBC. In a recent client note, he pointed out the Head-and-Shoulders top pattern that presaged the 1987 Crash.
In its simplest form, the Dow Jones Industrial Average formed a Head-and-Shoulders top when it violated its neckline. We then had a failed attempt to reclaim the neckline, which resulted in the Crash.
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Gunn notes that the Dow is forming a similar pattern today. He also notes that momentum is waning and Elliot Wave analysis indicates a 1987-like crash could indeed occur.
