December 5, 2008
The past weeks closes established a sequence of changes never seen before. Namely, to focus on just the S&P500, although the other two indices behaved just about the same, todays gain of near four percent, following yesterdays -2.93 percent, and the previous two gains greater than 2.5 percent, occurring after Mondays -8.93 percent loss, is unprecedented.
Moreover, this weeks string of closes: +1/-1/+2/-1 has occurred only fifty other times since January 2000. These are plotted below, for the S&P500. (The days other than this specific pattern are omitted.) Even a cursory inspection shows that most of these days happen when prices are in an upswing. Specifically, 36 such days share this quality, while only 14 sessions occur when prices are falling.
However, the last four sequences took place during the current downturn, since January 2008.
DJIA 3.09 percent
NASDAQ 4.41 percent
S&P500 3.65 percent