September Starts with a Bang

Examining Dow Industrials data since 1900, I found only 11 instances in which the Dow gained 1%+ on the first trading day of September. Interestingly, the gain usually marked a good time to exit the market or sell short over the remainder of the month. The Dow rallied over the next 20 trading days 5 times and fell 6 times, but the average gain was only 0.8%, with only one occurrence leading to a gain of more than 1%, while the average loss was a whopping 5.6%, with all losses exceeding 2%…

Dow +1% First Session of September
09/02/03… Dow -2.6% one month later
09/01/99… Dow -5.5% one month later
09/01/98… Dow +0.2% one month later
09/02/97… Dow +0.8% one month later
09/01/76… Dow +0.4% one month later
09/04/56… Dow -6.4% one month later
09/01/48… Dow -2.9% one month later
09/01/33… Dow -10.1% one month later
09/02/19… Dow +2.3% one month later
09/03/18… Dow +0.2% one month later
09/03/07… Dow -6.1% one month later

On a short-term basis, also note that TLT is in the process of posting a 2%+ down day. Should that stick into the close, this would trigger a sell signal for the S&P on Thursday (see this post from last Friday for details).

Categories : Archived Intraday Commentary, Intraday Commentary

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