Divergence Watch: New 52-week High/Low Data

Stocks are trading sharply lower Thursday, consistent with the market’s typical post-Fed day gap performance. With the SPX and NDX hitting fresh 5-day lows, it’s noteworthy that new 52-week lows are down from Wednesday’s levels on both the NYSE and NASDAQ. If this divergence holds into the close, it would have short-term bullish implications. The last thirty times we’ve seen this pattern triggered are listed in the table below. Note that in 27 out of 30 cases, or 90% of the time, the S&P closed higher (above the setup day’s close) within the next two sessions, significantly above the 68% at-any-time odds for a higher SPX close within two days…

SPX & NDX Hit 5-Day Lows, New 52-week Lows Decline
11/20/09… Higher SPX close one session later
07/07/09… Higher SPX close two sessions later
02/23/09… Higher SPX close one session later
12/02/08… Higher SPX close one session later
11/21/08… Higher SPX close one session later
10/09/08… Higher SPX close two sessions later
10/07/08… No higher close within two sessions
09/18/08… Higher SPX close one session later
09/17/08… Higher SPX close one session later
08/20/08… Higher SPX close one session later
06/12/08… Higher SPX close one session later
06/03/08… Higher SPX close two sessions later
01/23/08… Higher SPX close one session later
01/07/08… No higher close within two sessions
11/21/07… Higher SPX close one session later
11/12/07… Higher SPX close one session later
11/09/07… Higher SPX close two sessions later
07/31/07… Higher SPX close one session later
06/08/07… Higher SPX close one session later
04/12/07… Higher SPX close one session later
12/22/06… Higher SPX close one session later
11/03/06… Higher SPX close one session later
05/18/06… Higher SPX close one session later
01/03/06… Higher SPX close one session later
12/08/05… Higher SPX close one session later
11/30/05… Higher SPX close one session later
08/24/05… Higher SPX close one session later
04/18/05… Higher SPX close one session later
03/10/05… No higher close within two sessions
09/28/04… Higher SPX close one session later

Categories : Archived Intraday Commentary, Intraday Commentary

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