S&P Set to Join Nasdaq in New Highs

Strong showing today as the market has managed to shrug off recent short-term negative developments. TICKscore currently at +18, which will send the Cumulative TICKscore into new highs for the year. The S&P is set to close at a fresh six-month high, indicating we’re likely to see range-bound trade on Thursday. Each of the last thirty separate instances in which the S&P500 initially closed at a six-month high (meaning it did not close at a six-month high the previous session) are listed in the table below, along with the performance of the S&P the next day. Note the definitive tendency for the market to settle near unchanged levels. Not once out of the last thirty cases did the S&P gain 0.5% or more the next day, and in only four cases did it lose 0.5% or more…

S&P500 Closes at a Six-Month High
08/25/09… S&P +0.0% next session
08/21/09… S&P -0.1% next session
08/13/09… S&P -0.9% next session
08/07/09… S&P -0.3% next session
07/30/09… S&P +0.1% next session
07/23/09… S&P +0.3% next session
07/20/09… S&P +0.4% next session
06/11/09… S&P +0.1% next session
06/01/09… S&P +0.2% next session
10/09/07… S&P -0.2% next session
10/05/07… S&P -0.3% next session
07/19/07… S&P -1.2% next session
07/12/07… S&P +0.3% next session
05/30/07… S&P +0.0% next session
05/18/07… S&P +0.2% next session
05/16/07… S&P -0.1% next session
05/09/07… S&P -1.4% next session
05/02/07… S&P +0.4%  next session
04/25/07… S&P -0.1% next session
04/20/07… S&P -0.2% next session
04/16/07… S&P +0.2% next session
02/20/07… S&P -0.1% next session
02/14/07… S&P +0.1% next session
02/07/07… S&P -0.1% next session
02/01/07… S&P +0.2% next session
01/24/07… S&P -1.1% next session
01/12/07… S&P +0.1% next session
12/14/06… S&P +0.1% next session
12/04/06… S&P +0.4%  next session
11/21/06… S&P +0.2% next session

With the S&P currently up 0.85%, it’s noteworthy that new 52-week highs on the NYSE stand at 159, down 16 from yesterday’s level. When the S&P gains over 0.75% and posts higher highs and higher lows, you don’t typically see a drop in the number of new 52-week highs. When this does occur, it signals a relative absence of participation among market leaders (those at new highs), and usually means the rally is on shaky ground short-term. The last thirty times this pattern has occurred are listed in the table below, along with the S&P’s performance over the next three trading days. Note that in 23 out of the last 30 occurrences, or 77% of the time, the S&P500 was trading at a lower level three sessions later, significantly greater than the 45% at-any-time odds for a lower S&P three sessions later…

S&P +0.75% & Rally Day, New 52-week Highs Drop
08/12/09… S&P500 -2.6% three sessions later
06/29/09… S&P500 -3.3% three sessions later
05/08/09… S&P500 -4.9% three sessions later
05/06/09… S&P500 -1.1% three sessions later
03/04/09… S&P500 -5.1% three sessions later
02/03/09… S&P500 +3.6% three sessions later
01/28/09… S&P500 -5.6% three sessions later
01/02/09… S&P500 -2.7% three sessions later
11/28/08… S&P500 -2.9% three sessions later
11/24/08… S&P500 +5.2% three sessions later
11/04/08… S&P500 -7.4% three sessions later
10/31/08… S&P500 -1.7% three sessions later
10/13/08… S&P500 -5.7% three sessions later
07/16/08… S&P500 +1.2% three sessions later
07/08/08… S&P500 -2.7% three sessions later
05/15/08… S&P500 -0.7% three sessions later
05/12/08… S&P500 +1.4% three sessions later
03/18/08… S&P500 +1.4% three sessions later
02/13/08… S&P500 -1.4% three sessions later
01/24/08… S&P500 +0.8% three sessions later
01/10/08… S&P500 -2.8% three sessions later
11/23/07… S&P500 +2.0% three sessions later
07/28/06… S&P500 -0.0% three sessions later
07/03/06… S&P500 -1.2% three sessions later
02/08/06… S&P500 -0.2% three sessions later
09/02/04… S&P500 -0.2% three sessions later
04/05/04… S&P500 -1.0% three sessions later
05/06/03… S&P500 -0.1% three sessions later
04/23/03… S&P500 -0.5% three sessions later
03/19/03… S&P500 -1.1% three sessions later

Categories : Archived Intraday Commentary, Intraday Commentary

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