July 22, 2010 Largest Gain Since July 7Moving up by 1.99 percent and more, these indices posted the best day in the past 11 sessions. The NASDAQ gain of 2.68 percent ranks it as the 202nd largest; the S&P500 increase of 2.25 percent stands in place 233 from the top; whereas the DJIA, just short of 2 percent, is number 340 from the top.
Significantly, todays pattern of +1/-1/+2, our notation for describing todays gain, after yesterdays loss, which occurred after two previous advances, counts as its 39th repeat since January 2000. Almost all of these took place during the 2003/2007 bull market. Furthermore, only three of those closes had increases larger than todays and exceed more than 2 percent.
Finally, those three previous, larger than two percent closes, came near the end of the 2007/2009 decline. Their dates are August 8, 2008; December 30, 2008; and January 21, 2009, while the markets hit bottom on March 9, 2009.
Consequently, we can infer that these developments precede further gains in the near term, provided that these changes reflect permanent features of the buyer and seller mindset.
DJIA 1.99 percent
NASDAQ 2.68 percent
S&P500 2.25 percent