Tech turnaround might seem familiar to whipsawed investors

If the rebound in U.S. technology stocks from their jarring recent declines isn't giving investors a sense of deja vu, it probably should be. The biggest exchange-traded fund tracking the tech-heavy Nasdaq 100 Index has taken back almost half the 8.7% it lost during this month's flash sell-off in U.S. equities. Although some were spooked by the plunge occurring during the run-up to third-quarter earnings, long-term investors should take note that the recent pullback appears to be falling into what has been a consistent pattern for 2018. Through the first three quarters of the year, the $66.3 billion Invesco QQQ Trust went through five separate drawdowns of varying degrees. The steepest and longest was a 10% drop over 27 calendar days, while the shortest was 4.1% spanning five days. A simple average of the five drawdowns yields an average peak-to-trough move of 6.7% over a 14-day period.https://cdn-res.keymedia.com/investmentnews/uploads/assets/graphics src="/wp-content/uploads2018/10/CI1175371016.PNG"

The most recent slump started Oct. 1, when the technology ETF hit an intraday record high, but investors may have already seen this sell-off's recent bottom. Shares have rebounded 4% since last Thursday, the 10th day into the drawdown. (More: FAANGs are really solo acts, not a supergroup)