Do Not Ignore This Rare Three-Day Recovery Signal By Lucas Downey, Editor, TradeSmith's Alpha Signals Another week, another whiplash. It’s felt all year long like stocks get smacked on one headline, then rip on the next. It’s easy to get lost in the noise… or worse, quit. After all, we’re capping off one of the craziest months ever for stocks. Sitting on the sidelines may feel like the right move with all this whiplash. If that’s right for you, by all means, go ahead. But if you want to get in there and take advantage of this rare moment, history is full of evidence for how to handle this. It can help us cut through the noise and wild gyrations and make smart moves we’ll thank ourselves for later. That’s what we’ll seek to do today… Last week saw a rare triple thrust in large caps, mid-caps, and small caps. All three areas of the market saw monster three-day win streaks that rarely come along. The million-dollar question is: What’s next? If your gut is telling you to take profits, I can’t blame you. But history suggests you don’t want to keep a cautious stance for too long… < | Recommended Link | | | | One man is saying: FORGET most stocks and don’t panic about the market volatility. Because his strategy ignores 99% of stocks out there… And concentrates on profiting from gold – no matter what the market is doing. It all comes down to focusing on just one stock to profit from ANY movement in gold. Click here to watch right now. |  | | A Correction-Sized Bounce From the Lows The media will have you know that stocks are in a correction – 10% below the highs. That’s true. It’s also true that we’re in a reverse correction – 10% higher off the April 8 lows. The Nasdaq popped 12.4%. Small caps were up 11.1% and the S&P 500 was up a handsome 10% by Thursday: 
As they say on Wall Street, risk happens fast. Not only can stocks drop quickly… They can thrust upward just as fast. Much of the latest climb is due to a streak of gains from April 22 to April 24 – a triple thrust of more than 1.5% gains, three days in a row. The S&P 500 pulled that off, while the S&P SmallCap 600 and S&P MidCap 400 gained over 1.25% in three consecutive sessions: 
Let’s now visualize this three-day jump. Interestingly, all three indices have now eclipsed the recent high made on April 9 when the tariff pause was announced: 
A higher high is a very good sign. But that streak of big wins is an even better sign. Let me show you why. The Triple Thrust Signals More Momentum Ahead To understand just how rare three consecutive gains of 1.5%-plus for the S&P 500 are, I went back to 1979 and found seven discrete instances, including: - Three in the 1980s: 1982, 1984, 1987
- Three in the 2000s: 2002, 2011, 2016
- And once during the COVID crash of 2020
Interestingly, the S&P 500 has then averaged: - Three-month gains of 5.2%
- Six-month gains of 9.7%
- 12-month gains of 20.3%
- 24-month rips of 29.9%
That’s exciting! But we can’t stop here. Small caps and mid-caps have a story to tell, too. For this study, I looked for three consecutive daily gains of at least 1.25%. I found 28 prior instances for small caps. Mid-caps returned 27 data points. In a similar vein to large caps, the forward gains are nothing to sneeze at, with: - Three-month gains of 2.4% for small caps and 4.7% for mid-caps
- Six-month jumps of 11.3% for smalls and 13.2% for mids
- 12-month rallies of 23.9% for smalls and 27.2% for mids
- 24-month rips of 40.8% for smalls and 45.6% for mids
Look, we’ve been with you through the climactic downs the last few weeks. They weren’t fun. But from where I stand, markets are healing. We’re witnessing rare bullish thrusts that rarely come along… and have almost always preceded major continued momentum. Understand that just because the market is back on the up, it doesn’t mean the same old ideas will work the same way. With this major refresh comes new leadership… and new opportunities. This is where TradeSmith shines. Our cutting-edge software will alert you to the best-performing stocks in pole position. Don’t focus on where we are. Focus on where we’re going. Trust the thrust! Regards, 
Lucas Downey
Editor, TradeSmith’s Alpha Signals Note from Ashley Cassell, Managing Editor, TradeSmith Daily: As Lucas explained in today’s Daily, we just witnessed a strong bullish signal: the first “triple thrust” since the 2020 COVID crash. And he’s not the only analyst who’s bullish. In fact, Early Stage Investor editor Luke Lango predicts we’ll see a buying frenzy even bigger than the internet boom in the 1990s. According to Luke, this buying panic could start as soon as May 7. That’s why he’s holding an emergency briefing this Thursday – just days before he’d expect that massive stock-market rally. During his 2025 Summer Panic Summit, Luke will introduce a new set of seven small-cap U.S.-based stocks he’s dubbed the “MAGA 7” since he sees them taking over from the previous “Magnificent 7” as market leaders. The key to building a nest egg in this new bull market is to prepare before stocks get overhyped in the mainstream news. And that’s sure to be the case, since they fall into everyone"s favorite bullish theme: artificial intelligence. So, to learn about what Luke has for us here, make sure to automatically sign up for his event on Thursday at 7 p.m. Eastern time by clicking right here. | 
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