The NASDAQ moved higher for the third straight session while the DJIA and the S&P500 edged slightly higher for the second day in a row. This continues the series of rare patterns seen this month. Today’s combination is just the 13th repeat since the beginning of 1996.
The S&P500’s gain of a mere .08 percent is the eleventh consecutive day with advances smaller than .10 percent. Yet this is a welcome statistic because bull markets and small daily increases go hand-in-hand.
So far in this expansion, these smaller than .10 percent daily gains account for six percent of all closes. Similarly, in the previous, 2003/2007 bull market they amounted to 6.9 percent. By contrast, these occurred half as often, accounting for only 3.0 and 3.4 percent, in the last two bear markets.
While that seems counter intuitive, it nevertheless is true: small daily changes distinguish good times from market declines.
Today’s diagram focuses on the S&P500’s gain of .08 percent, showing their distribution over the last three price cycles. Based on this history, chances for gains and losses are about equal.
DJIA .02 percent
NASDAQ .22 percent
S&P500 .08 percent
