October 31, 2011 Another Substantial Reversal
Todays losses pushed prices back almost to the levels of a week ago Tuesday. At the close, the pattern was two losses for the NASDAQ and a single decline for the DJIA and the S&P500. This combination occurred 32 times since the beginning of 2000.
The diagram shows these days, and indicates the direction of price changes for the following day that is, tomorrow. Overall, losses (in red) outnumber gains (in green), with a ratio of 20:12.
Further, we see this pattern more often when the trend of prices is down.
Fridays projection, on the record of previous repeats, called for an increase in todays prices. This did not happen; moreover, it also missed the magnitude of the actual decline.
DJIA -2.26 percent
NASDAQ -1.93 percent
S&P500 -2.47 percent