July 15, 2011 Up Follows Yesterdays Down
Another day, another change says it all when describing this weeks trading. Yet, since the negative changes outweighed the daily gains, prices fell this week. The Friday-to-Friday change comes to more than minus two percent for the NASDAQ and the S&P500, and -1.39 percent for the DJIA.
Todays pattern, 1/-1/+1/-3, occurred only 11 times before, with 7 since 2000. Yet the distribution of these seven, over bull and bear times, provides a positive price outlook for the future. While none happened during the 2000/2003 drop, the following recovery saw four such closes. The 2007 decline had one, while todays is the third happening in the current, 2009, upswing.
The record for the following day, this coming Monday, shows an almost equal number of gains and losses. We note, once more, that projections based on only seven observations out of a universe of more than 3,000 trading days have little, if any, reliability.
DJIA .34 percent
NASDAQ .98 percent
S&P500 .56 percent
