Lots of smiles today as the DJIA, the NASDAQ, and the S&P500 moved higher, posting their third advance in a row. This, the sixth time for this pattern in 2013, means that so far they account for 3.5 percent of the 170 trading days this year. In contrast, there were just 96 repeats over the 4,440 sessions since 1996, amounting to only 2.16 percent.
Our diagram shows that three straight up days are a bull market thing – with a frequency of more than two percent in the past three price expansions; they appear just 1.1 percent of the time when prices are heading down.
As for tomorrow, the positive bull market bias of three up days in a row often exists also for the following day.
There were none in the 355 sessions of the 2007/2009 decline, and only .40 percent between the 1996 and 2003 drop; but they accounted for .85 percent of the days during the previous two expansions – there have been more than 1.3 percent so far since the 2009 bottom.
So far, in 2013, this positive streak continued on four of the previous five strings of three-up-days in a row. Indeed prices failed to continue to four straight up days only once for the NASDAQ and the S&P500, and twice for the DJIA.
Please refer to our commentaries of July 8, June 27, April 27, and March 5 for additional facts and analysis of three up days in a row.
DJIA .04 percent
NASDAQ .27 percent
S&P500 .12 percent
