Sign of Persistence on the Monthly SPX Chart
By
Rennie on Monday, August 17th, 2009 at 1:08 am
At the end of July, the S&P500 posted five consecutive higher closes on its monthly chart for the first time since 2006. Every instance since 1930 in which the S&P500 initially posted five consecutive higher closes on its monthly chart is listed in the table below…
Five Higher Closes on SPX Monthly Chart
07/31/09… S&P500 +1.7% one month later (open – ends 8/31)
10/31/06… S&P500 +1.7% one month later
12/31/04… S&P500 -2.5% one month later
02/27/04… S&P500 -1.6% one month later
07/31/03… S&P500 +1.8% one month later
01/29/99… S&P500 -3.2% one month later
03/31/98… S&P500 +0.9% one month later
03/29/96… S&P500 +1.3% one month later
04/28/95… S&P500 +3.6% one month later
01/29/93… S&P500 +1.1% one month later
03/28/91… S&P500 +0.0% one month later
02/28/86… S&P500 +5.3% one month later
12/31/82… S&P500 +3.3% one month later
08/29/80… S&P500 +2.5% one month later
05/30/75… S&P500 +4.4% one month later
04/28/72… S&P500 +1.7% one month later
03/31/71… S&P500 +3.6% one month later
04/30/64… S&P500 +1.2% one month later
03/30/61… S&P500 +0.4% one month later
07/31/58… S&P500 +1.2% one month later
01/29/54… S&P500 +0.3% one month later
11/30/49… S&P500 +4.4% one month later
12/31/45… S&P500 +7.0% one month later
04/30/43… S&P500 +4.5% one month later
09/30/42… S&P500 +6.4% one month later
10/31/40… S&P500 -4.2% one month later
09/30/36… S&P500 +7.5% one month later
08/31/35… S&P500 +2.4% one month later
Note that out of 27 occurrences, 23 (85%) led to a higher monthly close one month later, significantly above the 59% at-any-time odds. When the monthly chart shows signs of persistence, as is the case currently, it generally hasn’t paid to fight the underlying trend. On the three recent occasions in which the S&P finished out the next month lower, it’s noteworthy that the S&P didn’t trade more than 0.4% above the previous month’s high. This month the S&P has already traded more than 2% above July’s high.
Sign of Persistence on the Monthly SPX Chart
By Rennie on Monday, August 17th, 2009 at 1:08 amAt the end of July, the S&P500 posted five consecutive higher closes on its monthly chart for the first time since 2006. Every instance since 1930 in which the S&P500 initially posted five consecutive higher closes on its monthly chart is listed in the table below…
Five Higher Closes on SPX Monthly Chart
07/31/09… S&P500 +1.7% one month later (open – ends 8/31)
10/31/06… S&P500 +1.7% one month later
12/31/04… S&P500 -2.5% one month later
02/27/04… S&P500 -1.6% one month later
07/31/03… S&P500 +1.8% one month later
01/29/99… S&P500 -3.2% one month later
03/31/98… S&P500 +0.9% one month later
03/29/96… S&P500 +1.3% one month later
04/28/95… S&P500 +3.6% one month later
01/29/93… S&P500 +1.1% one month later
03/28/91… S&P500 +0.0% one month later
02/28/86… S&P500 +5.3% one month later
12/31/82… S&P500 +3.3% one month later
08/29/80… S&P500 +2.5% one month later
05/30/75… S&P500 +4.4% one month later
04/28/72… S&P500 +1.7% one month later
03/31/71… S&P500 +3.6% one month later
04/30/64… S&P500 +1.2% one month later
03/30/61… S&P500 +0.4% one month later
07/31/58… S&P500 +1.2% one month later
01/29/54… S&P500 +0.3% one month later
11/30/49… S&P500 +4.4% one month later
12/31/45… S&P500 +7.0% one month later
04/30/43… S&P500 +4.5% one month later
09/30/42… S&P500 +6.4% one month later
10/31/40… S&P500 -4.2% one month later
09/30/36… S&P500 +7.5% one month later
08/31/35… S&P500 +2.4% one month later
Note that out of 27 occurrences, 23 (85%) led to a higher monthly close one month later, significantly above the 59% at-any-time odds. When the monthly chart shows signs of persistence, as is the case currently, it generally hasn’t paid to fight the underlying trend. On the three recent occasions in which the S&P finished out the next month lower, it’s noteworthy that the S&P didn’t trade more than 0.4% above the previous month’s high. This month the S&P has already traded more than 2% above July’s high.