September
27, 2011 Gains Continue
Our three indices moved higher for the third successive
day, with each gaining more than one full percent. The pattern +3 has occurred some
230 times since the start of our database, in 1950. However, only 71 came since the beginning of
2000.
Todays diagram shows that most of these later 71
days cluster in the two bull markets; also that only 13 came during the two
declining phases. This distribution allows the fair inference that prices will
continue to move higher, and that the current expansion is not at its end.
The color of each point indicates the following days
result; with green designating price
increases, and red price decreases, on the following day. Strangely enough,
though, the proportion of plus days is larger when prices are heading down than
when they are moving up.
Sixty-two percent of the following days closes moved
higher during the two bear markets, whereas only 45 percent moved higher during
the two bull phases.
DJIA 1.33 percent
NASDAQ 1.20 percent
S&P500 1.07 percent
