Today’s losses mark the fourth –up then down- price change in the last five days. Our diagram plots the daily price changes, in percent, so far this year. It shows that only four days so far in August increased, or decreased, in excess of .5 percent.
Our research so far has not found specific relationships linking such minor daily price fluctuations and long-term price trends. For example, the series of daily price changes over the last four days is one decline, after two advances that followed one decline. This combination has occurred just about as frequently during price expansions as price contractions.
Specifically, they accounted for 1.00 percent of all recent bear market days and for .67 percent of the last three bull markets. This differential is too small to allow any association with price trends.
As for the following day, declines followed six of the last seven replays of today’s pattern. The last happening, in June, was followed by losses of 2.3 to 2.5 percent on the next trading day.
DJIA -.43 percent
NASDAQ -.01 percent
S&P500 -.40 percent
