Moving higher for the second day, the S&P500 at 1,104.18 has returned almost to its August 9 close of 1,128. Similarly, the DJIA and the NASDAQ are also recovering to their early August values. Given the recent ups and downs, today’s pattern comes in at +2/-1/+3; that expression summarizes the recent action, namely today’s and yesterday’s advances, together with Tuesday’s steep losses, and the mini rally at the end of last week.
This combination occurred just 12 times since 1950 and with today’s close, is the 5th repeat since January 2000. The analysis of the when and the how of these happenings does not yield a meaningful relationship with either a bull market, a turning point or a decline in prices, Turning to tomorrow’s action, both the NASDAQ and the S&P500 moved higher on the next day, three out of the four previous experiences. The DJIA, on the other hand, has only two subsequent increases together with two declines.
DJIA .27 percent
NASDAQ .33 percent
S&P500 .48 percent