--- title: "The S&P has risen for four consecutive days, but the fear index is still at 23—this kind of fear during a rebound is most likely to cause misjudgment." type: "Topics" locale: "en" url: "https://longbridge.com/en/topics/39738852.md" description: "Let's get straight to the point: The S&P 500 has risen for four consecutive trading days (3/31, 4/1, 4/2, 4/6, with a break on 4/3 for Easter), gaining 3.4% for the week and ending a five-week losing streak. However, during the same period, the CNN Fear & Greed Index (a measure of market sentiment, ranging from 0 to 100, where lower means more fear) is still at 23, indicating extreme fear. These two numbers together are very contradictory—one says the market is rising, the other says people are still very scared. This article today aims to help you figure out one thing: Is this a rebound or a reversal? You must distinguish between these two, because making the wrong call can be very costly..." datetime: "2026-04-07T07:44:02.000Z" locales: - [en](https://longbridge.com/en/topics/39738852.md) - [zh-CN](https://longbridge.com/zh-CN/topics/39738852.md) - [zh-HK](https://longbridge.com/zh-HK/topics/39738852.md) author: "[老韭菜进化论](https://longbridge.com/en/profiles/25150350.md)" --- # The S&P has risen for four consecutive days, but the fear index is still at 23—this kind of fear during a rebound is most likely to cause misjudgment. **Conclusion first: The S&P 500 has risen for four consecutive trading days (3/31, 4/1, 4/2, 4/6, with a market holiday on 4/3 for Easter), gaining 3.4% for the week, breaking a five-week losing streak.** But at the same time, the CNN Fear & Greed Index (a gauge of market sentiment, 0 to 100, lower means more fear) is still at 23, in the extreme fear zone. These two numbers together are contradictory—one says the market is rising, the other says people are still very scared. This article today aims to help you think clearly about one thing: Is this a rebound or a reversal? These two must be distinguished, because getting it wrong comes at a high cost. ### **First, why the market is rising now—it's betting on a deal that hasn't been announced yet** It's not fundamentals driving the rise. Brent crude at 111.09 is still near a four-year high, Fed officials have been talking about the need for rate hikes in recent days, and last week's ISM Price Index just hit a four-year high of 78.3. The rise is because news from Axios and Reuters suggests the US and Iran are discussing a 45-day ceasefire plan. The market is betting that a deal will emerge before Trump's Tuesday 8 PM deadline. This means the four-day rally is entirely built on a piece of news, a negotiation, and a deadline that hasn't expired yet. Everything supporting this rebound is outside your control. ### **How to tell a rebound from a reversal?—A very simple but useful method** Many will ask: It's been rising for four days, why isn't this a reversal? My own method for distinguishing them is very simple: see if the Fear Index has truly climbed out of the extreme fear zone. Only when it climbs into the neutral zone (above 40) and stays there for a few days will I consider it a reversal. Right now it's at 23, still nearly double the distance from 40. Why is this distinction important? Because chasing after a reversal is unlikely to result in a loss. Chasing after a rebound will likely get you slapped twice—once by the big red candle when the rebound ends, and once during the two days you hesitate about whether to cut your losses. ### **Last April, I missed a real reversal** Last April, during the Liberation Day tariff panic, the S&P fell nearly 19% in a week, VIX spiked above 50, and the CNN Fear Index hit single digits. Then Trump announced a 90-day suspension on April 9th, and the market surged 9% in a single day. I didn't chase it then, thinking it was a pulse-like rebound. But that time it actually reversed—recovering all the losses in 89 days, with the S&P hitting new highs by the end of June. I missed the entire wave. But what that miss taught me wasn't that rebounds always turn into reversals. It taught me: **A wrong outcome doesn't mean the method is wrong.** I didn't chase because I didn't see reversal signals. **That time, I just happened to bet correctly on the direction of risk—risk and outcome are two different things. You can't abandon your judgment method next time just because the outcome was wrong this time.** ### **The itch to trade is harder this time—because those who have missed out are most afraid of missing out again** I've felt the itch these past four days, and it's more uncomfortable than usual. Because last year's miss is still in my head. Every time I see a rebound, that voice inside gets especially loud: Could this be like last year? If I don't get on board now, will I miss another wave? When I wrote my Q1 review last Wednesday, I said the only thing I did right in Q1 was—doing nothing. It felt cool to write that at the time. Now, on the third trading day of Q2, with a real rebound here, that statement suddenly feels much harder to execute. Every time I want to act, I ask myself: Do you want to act, or are you afraid not to act? Wanting to act is because of a new judgment. Being afraid not to act is because you can't stand watching others make money, or you're afraid of missing out again. The answer this time, like the past four weeks, is the latter. **My two conditions for adding positions remain unchanged: Brent crude closing below 100 for a full week, and VIX (the Fear Index, lower means a calmer market) staying below 25 for three consecutive days. Today Brent is at 111, VIX is hovering around 24, neither condition is triggered. If you're also waiting for a signal to add positions, I suggest referencing similar dual conditions—don't act unless both are met, this can prevent you from being swayed by daily price movements.** ### **Tuesday at 8 PM is a real critical juncture** Trump's deadline for Iran is Tuesday 8 PM EST (approximately Wednesday morning Beijing time). Three possibilities: First, a deal is reached. The market might rise further, but it could also sell off on the news. Second, no deal but an extension. The market might maintain the status quo, remaining tense. Third, talks collapse. The Middle East situation escalates, oil prices surge to 120, and all the gains of these four days are wiped out. Among these three scenarios, the first and third could make those who chased today regret it. Only the second might make you temporarily correct—but temporary doesn't count. **Specific action advice: Before the Tuesday 8 PM deadline is revealed, don't add to your positions just because the market has risen for four days (especially for tech and energy stocks, which are most sensitive to Middle East news).** Wait for the outcome, see where the market's first daily candlestick closes before deciding—if a deal is reached and the market continues to rise, that's a preliminary signal of a reversal; if a deal is reached but the market falls instead, that's selling on the news, you should reduce, not add. What's truly scary isn't how much it has risen these four days. It's you watching this four-day rise, mistaking a rebound for a reversal, then adding positions on the fifth day, only for the Tuesday 8 PM deadline to bring a surprise that buries your new positions. **A rebound is the market catching its breath, a reversal is the trend actually changing direction. Mistaking the former for the latter is the most expensive optimism for retail investors.** The 32nd trading day. I still haven't moved. Anyway, I haven't moved, let's see after this Friday's CPI data. $NVIDIA(NVDA.US) $Cboe Volatility Index(.VIX.US) $Us Brent Oil(BNO.US) ### Related Stocks - [VOOG.US](https://longbridge.com/en/quote/VOOG.US.md) - [BNO.US](https://longbridge.com/en/quote/BNO.US.md) - [.VIX.US](https://longbridge.com/en/quote/.VIX.US.md) - [.SPX.US](https://longbridge.com/en/quote/.SPX.US.md) - [SPY.US](https://longbridge.com/en/quote/SPY.US.md) - [NVDA.US](https://longbridge.com/en/quote/NVDA.US.md) ## Comments (1) - **CGeorge96 · 2026-04-08T03:15:44.000Z**: Hold for long term