USMarketView

July 29, 2008

The market headed up from the start, as it reversed itself again, and in a complete opposite of yesterday, the indices closed up by more than 2.3 percent.

With prices moving up and down like a rocking horse, this pattern has now repeated for the 11^th time this year. On only one occasion did prices rise by more than two percent – but increases greater than one percent were registered eight times.

In terms of associating this model with trends of price changes, in the past eight years, rising markets have more of these down one day and up the nest day than falling prices. Consider the 21 occurrences in 2003, when the S&P500 gained more than 25 percent; compared to 2000, when prices fell ten percent with just four of these rocking horse days.

As for turning points, three rocking horse days, since 2000, scored gains exceeding two percent for all three indices. As illustrated below, two of these came at a local peak just before prices hit bottom and the market rebounded into a new, long term rise. But does the 2007 event at the peak, combined with today, signal a similar future, or will prices continue to fall?

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DJIA 2.39 percent

NASDAQ … 2.45 percent

S&P500 2.31 percent

This entry was posted on Tuesday, July 29th, 2008 at 12 052008000000Tue, 29 Jul 2008 17:25:49 +0000 and is filed under Market Report. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.