Positive Short-term Seasonal Tendencies Surrounding Thanksgiving
By
Rennie on Monday, November 24th, 2008 at 9:00 pm
Traditionally, 3:1+ positive breadth days on the NASDAQ exchange signal buying power is spent for the short-term. Over the last decade, there have been 23 separate sessions in which advancing issues outnumbered declining issues by more than a 3:1 margin on the NASDAQ exchange. Each instance is noted in the table below, along with the performance of the NDX the following day. Note that in only one case did the Nasdaq gain more than 0.5%, suggesting limited upside potential on Tuesday…
Nasdaq Breadth 3:1 Positive
11/24/08… NDX ??? next day
10/31/08… NDX -0.0% next day
10/13/08… NDX -4.5% next day
09/19/08… NDX -4.5% next day
07/16/08… NDX +0.5% next day
04/01/08… NDX -0.4% next day
03/18/08… NDX -2.6% next day
11/28/07… NDX +0.3% next day
11/23/07… NDX -2.0% next day
09/18/07… NDX +0.3% next day
08/29/07… NDX +0.5% next day
03/06/07… NDX -0.4% next day
10/12/06… NDX +0.5% next day
08/15/06… NDX +2.3% next day (*)
07/19/06… NDX -1.6% next day
06/29/06… NDX -0.7% next day
06/15/06… NDX -0.7% next day
03/12/04… NDX -2.2% next day
11/27/02… NDX -0.9% next day
10/15/02… NDX -4.2% next day
04/05/01… NDX -4.7% next day
01/03/01… NDX -2.7% next day
06/02/00… NDX -0.7% next day
04/18/00… NDX -3.6% next day
We often refer to the activity on the Nasdaq exchange as more ‘speculative’ compared to trading on the big board. It’s therefore not surprising to learn that given speculators’ penchant for tech stocks, the Nasdaq100 Index (NDX) has done exceptionally well during the seasonally bullish two-day period surrounding the Thanksgiving holiday. Even more impressive is the limited downside potential for the Nasdaq, reflecting the fact that with limited institutional participation, speculators can and generally do drive tech stocks higher in the two days surrounding Thanksgiving. Listed below is the performance of the Nasdaq in the two-day time frame immediately before and after the Thanksgiving holiday. The first date is the closing price two days before the break, followed by the date of the first close after the holiday and the performance of the Nasdaq in this time frame…
NASDAQ Performance Day Before & After Thanksgiving
11/25/08 ????.??… 11/28/08 ????.??… NDX ???
11/20/07 2029.94… 11/23/07 2028.90… NDX -0.1%
11/21/06 1808.88… 11/24/06 1815.53… NDX +0.4%
11/22/05 1694.14… 11/25/05 1701.05… NDX +0.4%
11/23/04 1562.60… 11/26/04 1578.26… NDX +1.0%
11/25/03 1411.36… 11/28/03 1424.25… NDX +0.9%
11/26/02 1087.49… 11/29/02 1116.10… NDX +2.6%
11/20/01 1549.70… 11/23/01 1577.47… NDX +1.8%
11/21/00 2786.53… 11/24/00 2830.09… NDX +1.6%
11/23/99 2999.78… 11/26/99 3116.62… NDX +3.9%
11/24/98 1580.83… 11/27/98 1628.35… NDX +3.0%
11/25/97 1038.06… 11/28/97 1050.51… NDX +1.2%
11/26/96 825.51… 11/29/96 834.01… NDX +1.0%
11/21/95 574.22… 11/24/95 578.32… NDX +0.7%
11/22/94 397.93… 11/25/94 401.17… NDX +0.8%
11/23/93 381.22… 11/26/93 386.31… NDX +1.3%
11/24/92 349.97… 11/27/92 349.31… NDX -0.2%
11/26/91 284.13… 11/29/91 284.79… NDX +0.2%
11/20/90 183.31… 11/23/90 184.28… NDX +0.5%
11/21/89 222.76… 11/24/89 224.83… NDX +0.9%
11/22/88 164.35… 11/25/88 165.72… NDX +0.8%
11/24/87 144.66… 11/27/87 143.35… NDX -0.9%
11/25/86 145.77… 11/28/86 147.94… NDX +1.5%
11/26/85 123.95… 11/29/85 126.06… NDX +1.7%
11/20/84 243.04… 11/23/84 245.45… NAZ +1.0%
11/22/83 284.55… 11/25/83 285.49… NAZ +0.3%
11/23/82 225.17… 11/26/82 228.64… NAZ +1.5%
11/24/81 199.04… 11/27/81 201.02… NAZ +1.0%
11/25/80 205.41… 11/28/80 208.15… NAZ +1.3%
11/20/79 139.50… 11/23/79 139.85… NAZ +0.3%
11/21/78 114.56… 11/24/78 116.17… NAZ +1.4%
*pre-1985 figures based on Nasdaq Composite
Note that tech stocks in particular have performed consistently well in the two-day window surrounding Thanksgiving. In 27 out of 30 cases the Nasdaq moved higher, and in only one case did it fall more than 0.5%. This setup goes into effect at Tuesday’s close and remains in effect until Friday’s close. Accordingly, it appears the best chances for a selloff are Tuesday and next Monday (December 1st).
Positive Short-term Seasonal Tendencies Surrounding Thanksgiving
By Rennie on Monday, November 24th, 2008 at 9:00 pmTraditionally, 3:1+ positive breadth days on the NASDAQ exchange signal buying power is spent for the short-term. Over the last decade, there have been 23 separate sessions in which advancing issues outnumbered declining issues by more than a 3:1 margin on the NASDAQ exchange. Each instance is noted in the table below, along with the performance of the NDX the following day. Note that in only one case did the Nasdaq gain more than 0.5%, suggesting limited upside potential on Tuesday…
Nasdaq Breadth 3:1 Positive
11/24/08… NDX ??? next day
10/31/08… NDX -0.0% next day
10/13/08… NDX -4.5% next day
09/19/08… NDX -4.5% next day
07/16/08… NDX +0.5% next day
04/01/08… NDX -0.4% next day
03/18/08… NDX -2.6% next day
11/28/07… NDX +0.3% next day
11/23/07… NDX -2.0% next day
09/18/07… NDX +0.3% next day
08/29/07… NDX +0.5% next day
03/06/07… NDX -0.4% next day
10/12/06… NDX +0.5% next day
08/15/06… NDX +2.3% next day (*)
07/19/06… NDX -1.6% next day
06/29/06… NDX -0.7% next day
06/15/06… NDX -0.7% next day
03/12/04… NDX -2.2% next day
11/27/02… NDX -0.9% next day
10/15/02… NDX -4.2% next day
04/05/01… NDX -4.7% next day
01/03/01… NDX -2.7% next day
06/02/00… NDX -0.7% next day
04/18/00… NDX -3.6% next day
We often refer to the activity on the Nasdaq exchange as more ‘speculative’ compared to trading on the big board. It’s therefore not surprising to learn that given speculators’ penchant for tech stocks, the Nasdaq100 Index (NDX) has done exceptionally well during the seasonally bullish two-day period surrounding the Thanksgiving holiday. Even more impressive is the limited downside potential for the Nasdaq, reflecting the fact that with limited institutional participation, speculators can and generally do drive tech stocks higher in the two days surrounding Thanksgiving. Listed below is the performance of the Nasdaq in the two-day time frame immediately before and after the Thanksgiving holiday. The first date is the closing price two days before the break, followed by the date of the first close after the holiday and the performance of the Nasdaq in this time frame…
NASDAQ Performance Day Before & After Thanksgiving
11/25/08 ????.??… 11/28/08 ????.??… NDX ???
11/20/07 2029.94… 11/23/07 2028.90… NDX -0.1%
11/21/06 1808.88… 11/24/06 1815.53… NDX +0.4%
11/22/05 1694.14… 11/25/05 1701.05… NDX +0.4%
11/23/04 1562.60… 11/26/04 1578.26… NDX +1.0%
11/25/03 1411.36… 11/28/03 1424.25… NDX +0.9%
11/26/02 1087.49… 11/29/02 1116.10… NDX +2.6%
11/20/01 1549.70… 11/23/01 1577.47… NDX +1.8%
11/21/00 2786.53… 11/24/00 2830.09… NDX +1.6%
11/23/99 2999.78… 11/26/99 3116.62… NDX +3.9%
11/24/98 1580.83… 11/27/98 1628.35… NDX +3.0%
11/25/97 1038.06… 11/28/97 1050.51… NDX +1.2%
11/26/96 825.51… 11/29/96 834.01… NDX +1.0%
11/21/95 574.22… 11/24/95 578.32… NDX +0.7%
11/22/94 397.93… 11/25/94 401.17… NDX +0.8%
11/23/93 381.22… 11/26/93 386.31… NDX +1.3%
11/24/92 349.97… 11/27/92 349.31… NDX -0.2%
11/26/91 284.13… 11/29/91 284.79… NDX +0.2%
11/20/90 183.31… 11/23/90 184.28… NDX +0.5%
11/21/89 222.76… 11/24/89 224.83… NDX +0.9%
11/22/88 164.35… 11/25/88 165.72… NDX +0.8%
11/24/87 144.66… 11/27/87 143.35… NDX -0.9%
11/25/86 145.77… 11/28/86 147.94… NDX +1.5%
11/26/85 123.95… 11/29/85 126.06… NDX +1.7%
11/20/84 243.04… 11/23/84 245.45… NAZ +1.0%
11/22/83 284.55… 11/25/83 285.49… NAZ +0.3%
11/23/82 225.17… 11/26/82 228.64… NAZ +1.5%
11/24/81 199.04… 11/27/81 201.02… NAZ +1.0%
11/25/80 205.41… 11/28/80 208.15… NAZ +1.3%
11/20/79 139.50… 11/23/79 139.85… NAZ +0.3%
11/21/78 114.56… 11/24/78 116.17… NAZ +1.4%
*pre-1985 figures based on Nasdaq Composite
Note that tech stocks in particular have performed consistently well in the two-day window surrounding Thanksgiving. In 27 out of 30 cases the Nasdaq moved higher, and in only one case did it fall more than 0.5%. This setup goes into effect at Tuesday’s close and remains in effect until Friday’s close. Accordingly, it appears the best chances for a selloff are Tuesday and next Monday (December 1st).