Prices have now changed direction four times in the last five trading days, demonstrating quite understandably the uncertainty caused by sudden market decline. With today’s gains ranging between 1.14 and 1.24 percent, we consider the frequency and the placement of such days over the last five price cycles.
The diagram shows just seven of these – all happening during bull markets. Further, they all occur near a pause, or just after an interruption, in the trend of rising prices. Yet notice that two happened in quick succession just 15 days before prices reached their highest point and turned down in October 2007.
DJIA 1.22 percent
NASDAQ 1.14 percent
S&P500 1.24 percent
