Prices Recover at End of Day

March 6, 2009


The session closed barely on the plus side for the DJIA and the S&P500 after being in the red most of the day.  The NASDAQ had the same pattern, but failed to recover to yesterday’s close, dropping just  -.44 percent. In summarizing the past week, today’s result help to believe that it was not too bad; two huge drops, one substantial gain, and two days off less than minus one percent for the NASDAQ – and only one day less than minus one percent for the DJIA and the S&PP500.

 

Moreover, the evidence of today’s S&P500 pattern, suggests that perhaps the end of this downturn “is around the corner.” The index repeated this pattern of    +1/-1/+1/-5  twice in 2002, at the bottom of that bear market.  However, there was a third occasion, when prices slowed their upward momentum during that recovery.

 

Yesterday’s conjecture that, based on past records of days with identical patterns, of an even chance of prices rising or falling today, is consistent in a way with today’s result of the indices clustered around zero change.

 

As for Monday, history does not offer much guidance, since there has been only one other day, in 1976, that mirrors today’s pattern.  That result shows the three indices rising on the following day, but by just about a half a percent.

 

 

 

 

DJIA               .49 percent

NASDAQ      -.44 percent

S&P500          .12 percent

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