Tis the forecasting season, and today’s configuration of an increase in the S&P500 while the DJIA decreased, happens far more often when the market is rising than when prices are falling. Today’s diagram shows this combination favors bull markets, it occurs near twice as often as in bear markets.
The frequency of this mix when prices are heading down is about 4.5 percent; it is near double in the current upturn, at 7.8 percent.
Advances also outnumber declines on the following day when prices are moving higher. The S&P500 has closed higher 61 percent of the time in the 2009/2013 bull market. The next day positive ratio, however, was just 19 percent in the previous, 2007/2009 bear phase.
The record for 2013 shows 13 such days, when the S&P500 closed higher but the DJIA fell – all but two of which accompanied a period of rising prices.
DJIA -.27 percent
NASDAQ .67 percent
S&P500 .28 percent
