Investors should ‘stay the course’ as markets continue to shake

CNBC’s Jim Cramer told investors that they should not lose faith in the market’s ability to recover after Wednesday’s declines.

“History is very clear: It says you must stay the course. The S&P 500’s already had a successful 50% retracement of its huge decline, and in the 21 times that’s happened since the Great Depression, it meant the decline is over every single time , “Cramer said, noting that the averages retraced 50% of their post-November decline after yesterday.

“Could this time be different? Sure, but do not ignore the very real possibility that good things can happen, too,” he added.

The “Mad Money” host, who cautioned investors against unwarranted optimism on Tuesday, cited information from legendary market technician Larry Williams for his analysis of the markets’ future course. Cramer has relied on Williams’ analysis to make market predictions in the past.

Cramer listed several factors, in addition to the pattern Williams spotted, that suggested the markets could recover, including the Russia-Ukraine war seeming to enter a stalemate, which could potentially lead to an end sooner than later.

He also pointed to the Federal Reserve’s recent interest rate hike, Fed Chair Jerome Powell’s strong comments on inflation and the Covid-19 pandemic potentially ending soon as additional market factors.

“This is a brutal environment with a lot of truly awful possibilities, and I would not be surprised if tomorrow’s worse than today.… But at moments of extreme doom and gloom, like I saw today, I need you to remember that the bears could perhaps be wrong, “Cramer said.

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