S&P 500 May Plunge 21%, Bank of America Says

[marmar]

(Bloomberg) The Standard & Poor’s 500 Index may slump as much as 21 percent as volatility on the benchmark measure continues, according to Bank of America Corp. (BAC) technical analysts.

The U.S. benchmark index may slump to 910, Mary Ann Bartels and Stephen Suttmeier, Bank of America’s New York-based technical market analysts, wrote in a report today. That would be 21 percent lower than the index’s closing price of 1,154.23 on Sept. 9.

“We are more concerned now that the downside risk could be more than we originally forecast,” Bartels and Suttmeier wrote. “Measured moves suggest 985-910 on the S&P 500 is a potential range where a market bottom may finally be found.”

The VIX, as the Chicago Board Options Exchange Volatility Index is known, jumped 14 percent to 38.52 last week, as concern Greece’s finances are deteriorating overshadowed President Barack Obama’s $447 billion plan to stimulate growth. The gauge measures the cost of derivative prices on the S&P 500. .............(more)

The complete piece is at: http://www.bloomberg.com/news/2011-09-12/s-p-500-may-plunge-21-bank-of-america-says-technical-analysis.html

[On the Road]

1. Actually, I'm a Little Shocked by This:

The VIX...jumped 14 percent to 38.52 last week

VIX values in the 40-50 range are unusual. And when they happen, it's usually just before a rise in stock prices. Simply based on the VIX, I wouldn't go shorting the market right now.

[Lasher]

2. I have a contrarian philosophy.

When pundits and analysts like Mary Ann Bartels and Stephen Suttmeier warn of gloom, it's time to buy.

[On the Road]

7. I Do, Too

and that's how watching the VIX is supposed to work.

The trick is to get the timing right. If you buy at 40, and the VIX spikes to 50, that can be another 10% drop.

[Turbineguy]

3. Making BAC's stock drop seem less bad?

Everybody who predicts the markets has an agenda.

[kenny blankenship]

4. Yep, BOA may go to 0 long before the broader index gets beaten down.

[leftyohiolib]

5. more than we originally forecast, ya know im getting tired

of hearing this from people who should know. the drop is more than we expeced - the planet is heating faster than we expected- the ice is melting faster than we expected - no one could have foreseen terrorists using planes as weapons. what good are the "experts" if everything happens differently than the "experts" expect. morons

[L0oniX]

6. All the people with no jobs and the homeless are shocked.

[unblock]

8. in a related story, bank of america may plunge 21%, s&p says....

:evilgrin:

[leftyohiolib]

9. that's what i think this is, a veiled threat

back of BoA or suffer a 21% drop

[MilesColtrane]

10. "You've got a nice stock market here. It'd be a shame if anything 'appened to it."

"Of course uh....things break. Don't they?"

[Dokkie]

11. And I predict a 3% increase

in the gold/silver price. Most miss this opportunity.