Though the NASDAQ and the S&P500 extended their winning streak to four days, the DJIA lost ground, albeit just barely, closing down at minus .10 percent. Today’s diagram, plotting such closes over the past 5 price cycles, shows this pattern to be rare and also to be associated with rising prices.
One such incident occurred just one day after prices hit their 2000 top; another happened 90 days before the 2007 top. But in general, especially given this pattern’s infrequency, such closes fail to signal market turning points.
The last two incidents, in September and October of last year, resulted in higher prices on the following day. In general, however, the following days saw an even number of gains and losses.
DJIA -.10 percent
NASDAQ .23 percent
S&P500 .14 percent
