The DJIA, NASDAQ and S&P500 moved higher following yesterdays losses which, in turn, came after increases the day before. This chain of Up, After Down, After Up has happened just 87 other times in this century. These occurred more often during market declines than when prices were moving higher. Yet the disparity is not large: 3.1 percent of all closes during the 2000/2003 and 2007/2009 declines, compared to 2.4 percent of the days since 2009 and 2003/2007.
On the following day, prices declined 62 percent of the time during the two contractions while the declines amounted to only 48 percent of the days in the two expansions.
The diagram of the S&P500 locates these days; it reveals that many of the next day declines cluster around turning points. That permits a positive outlook for the future -since todays combination is the first since June 2012- if changes in price trends happen only after a string of these Up, After Down, After Up days.
DJIA .65 percent
NASDAQ 1.23 percent
S&P500 .98 percent
