GET DAILY SIGNALSStocks Plunge – What Happens Next?
It’s been a rough couple of weeks for stocks. After about two years of dormancy, volatility is back in the markets with the S&P 500 crossing into correction territory (-10%) for the first time since early 2016. The question on many investor’s minds is, what happens from here?
History suggests a few outcomes may be possible.
According to Goldman Sachs Chief Global Equity Strategist, Peter Oppenheimer, the average bull market 'correction' is about 13% over four months, with about a four-month period needed for stocks to recoup the lost value. At this rate, that could technically mean getting back to even from current losses by this fall! Not an ideal outcome, but remember that averages and history are just meant to provide insights – not forecasts.
Another statistic Mr. Oppenheimer mentions is that if the S&P 500 crosses the 20% mark, which would technically put it into bear market territory, then the ‘pain’ lasts for 22 months on average, with a much longer recovery time before getting back to even.
Most big players in finance such as Goldman Sachs, JP Morgan, Credit Suisse, Bank of America, and others are forecasting a positive year for stocks in 2018, so the bear market outcome appears remote according to their forecasts. Most of the economic data and fundamentals they cite for a positive year remain intact, which gives the impression that what is occurring today in the market is a stock market correction, not a bear.
So, if this is a stock market correction and not a bear, what should investors do next? Famed mutual-fund manager Peter Lynch has perhaps the best advice, when he said that “far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves.” In other words, if the investor believes this to be a correction, which means it’s a short-term dip in prices, perhaps the best approach would be to see it as a new opportunity to invest in areas that look attractive. Or, do nothing at all.
Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
GS's RSI Indicator recovers from oversold territory
The RSI Oscillator for GS moved out of oversold territory on October 15, 2026. This could be a sign that the stock is shifting from a downward trend to an upward trend. Traders may want to buy the stock or call options. The A.I.dvisor looked at 22 similar instances when the indicator left oversold territory. In 17 of the 22 cases the stock moved higher. This puts the odds of a move higher at 77%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. 41 of 54 cases where GS's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 76%.
The Momentum Indicator moved above the 0 level on October 27, 2026. You may want to consider a long position or call options on GS as a result. In 57 of 76 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 75%.
The Moving Average Convergence Divergence (MACD) for GS just turned positive on October 12, 2026. Looking at past instances where GS's MACD turned positive, the stock continued to rise in 28 of 46 cases over the following month. The odds of a continued upward trend are 61%.
Following a +4.12% 3-day Advance, the price is estimated to grow further. Considering data from situations where GS advanced for three days, in 212 of 345 cases, the price rose further within the following month. The odds of a continued upward trend are 61%.
Bearish Trend Analysis
Following a 3-day decline, the stock is projected to fall further. Considering past instances where GS declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 56%.
GS broke above its upper Bollinger Band on October 27, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Aroon Indicator for GS entered a downward trend on October 26, 2026. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Fundamental Analysis (Ratings)
The Tickeron SMR rating for this company is 4 (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is 18 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 87, placing this stock better than average.
The Tickeron Price Growth Rating for this company is 57 (best 1 - 100 worst), indicating steady price growth. GS’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is 61 (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Seasonality Score of 85 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Valuation Rating of 89 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (2.371) is normal, around the industry mean (3.578). P/E Ratio (13.613) is within average values for comparable stocks, (8.464). Projected Growth (PEG Ratio) (1.133) is also within normal values, averaging (0.809). Dividend Yield (0.022) settles around the average of (7.367) among similar stocks. P/S Ratio (4.394) is also within normal values, averaging (16.763).
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