Prices declined almost one percent after hitting new highs two days in a row. History shows this loss is not unusual; indeed prices fell on the following days after the highs of 2000 and 2007.
The diagram shows the changes in the S&P500 for the first fifteen days after this index hit their previous record highs.
Those losses, though, were quite smaller. The S&P500 change was -.24 percent in 2000; it declined just -.17 percent in 2007. Today’s price is .93 percent lower than the day before – the day prices reached a new peak.
There is a distinct difference, however, between those earlier highs and today. Namely, prices declined thereafter; they never returned to regain or pass their previous highs.
The current market may well show more strength; rather than further declines –as in 2000 and 2007, 2013 may yet generate higher prices than the April 30 top.
Yesterday’s declines may be temporary, and the record shows losses after new highs as typical, not unusual.
DJIA -.94 percent
NASDAQ -.89 percent
S&P500 -.93 percent
