January 7, 2011 Small Changes, Like Todays, Dominate Up Markets
Another session, the fourth this week, closed with only modest changes from the day before. Minimum daily fluctuations have become the rule, rather than the exception, since November. This trend should be welcomed: such closes go together with rising prices.
The table below summarizes the gains and losses of closes in the same range as todays, for the periods since March 2003, the beginning of the two most recent price cycles.
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DJIA -.19 PERCENT NASDAQ -.25 PERCENT S&P500 -.18 PERCENT |
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Comparing the total number of gains and losses by each era shows that they occur more often in good times. More important, this domination carries over to their relative frequency.
Whereas these days in losing markets happen on less than .6 percent of all days, they reached almost 4 percent in the previous, 2007 peak. Currently at 2.41 percent, these recent small change days associated with significant price advances, show conformity with this history.
DJIA - .19 percent
NASDAQ – .25 percent
S&P500 -.18 percent