After the vicious sell-off last week, Jim Cramer wanted to know how much more pain the S&P 500 has to endure before it finally bottoms. And what he discovered could be significant.
The reason Cramer turned to Boroden is she previously nailed calling the peak of the S&P. When Cramer last checked in with her in June, she said it was time to get cautious about the S&P. In June, she thought the rally for the S&P would peak around 2,138. Sure enough, it peaked at 2,134.
Boroden utilizes a mathematical methodology based on the medieval mathematician Leonardo Fibonacci. He discovered that a key series of ratios tend to repeat themselves over and over again in nature.
These ratios can also appear at key levels in the stock market. Boroden looks at past swings of a stock or index and then utilizes the Fibonacci ratios to find potentially important levels that could change a trajectory.
Given the recent volatility, Boroden believes that this market is vulnerable to the downside. Looking at the S&P 500's weekly chart, she did not like what she saw.