February 9, 2012 Third Straight Positive Session
Increases continued for the third day in a row, as the market posted the 76th repeat of the +3/+3/+3 pattern since January 2000. Many of these closes are concentrated in bull markets; they represent 2.9 percent of all trading days during the 2003/2007 expansion, and almost four percent of the 730 days since the 2009 bottom. These proportions fall to only 1.1 percent in the 2000/2003 and 2007/2009 bear phases.
With the difference in these ratios so large the up market rate is three to four times the size of the down market frequency- todays market confirms that the current advance in prices will continue in the near future.
Yet the outlook for tomorrow is not promising; in the past, the 39 losses on the following day exceeded the 36 increases.
We note also that the downsizing of these daily gains continues. Whereas todays S&P500 advanced .15 percent, the average gain over the 75 previous, three upticks in row, closes was .83 percent. Similarly, the DJIAs average gain of .80 percent overwhelms today .05 percent increase, while the NASDAQs .39 percent advance is less than half the .99 percent average.
DJIA .05 percent
NASDAQ .39 percent
S&P500 .15 percent