The NASDAQ lost -1.75 percent and closed lower for the fourth successive session. The S&P500, similarly down for the fourth day in a row, dropped -1.62 percent. While the DJIA dropped -1.29 percent today, it did not experience a long string of daily declines.
While all three averages suffered their largest decline in a month, todays pattern seems a more relevant indicator. The NASDAQ and S&P500 pattern count of -4 (straight negative closes) combined with the DJIA of -1 (negative close) is only the fifth ever – though the last four happened between September 2008 and June of this year.
The 2008 event coincides with the sharp continuation of the October 2007 decline. The next, February 2009, occasion preceded the last bottom, in March 2009. The following incident marked the bottom of a short decline later in 2009, whereas the last, June 25, 2010, repeat came as prices reached a temporary low, after this Aprils peak.
Therefore, even though no specific cause and effect relationship about price changes is justified, these data reveal that todays pattern has preceded major changes in the markets direction.
DJIA -1.59 percent NASDAQ -1.75 percent
S&P500 -1.62 percent