Weekly Pattern – MarketTells.com

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The NYSE McClellan Oscillator hit oversold territory on Friday, closing at -206. Looking back at times when the McClellan crossed into oversold territory on a Friday, it’s about 60-40 in terms of whether the S&P closes higher or lower the next session. But note the average loss of 2.5%, more than triple the average gain of 0.7%…

NYSE McClellan Falls Below -200 on Friday
07/16/20… SPX ??? next day
06/26/20… SPX +1.5% next day
02/02/18… SPX -4.1% next day
01/15/16… SPX +0.1% next day
01/08/16… SPX +0.1% next day
12/11/15… SPX +0.5% next day
11/13/15… SPX +1.5% next day
08/21/15… SPX -3.9% next day
12/12/14… SPX -0.6% next day
05/31/13… SPX +0.6% next day
06/10/11… SPX +0.1% next day
05/14/10… SPX +0.1% next day
01/22/10… SPX +0.5% next day
03/07/08… SPX -1.6% next day
11/09/07… SPX -1.0% next day
08/03/07… SPX +2.4% next day
03/02/07… SPX -0.9% next day
05/07/04… SPX -1.1% next day
08/28/98… SPX -6.8% next day

The weekly S&P500 posted a 52-week high and a 1% down close, the third occurrence this year. This pattern has had a tendency to precede further downside over the next two weeks. Over the last 30 occurrences, the S&P was up 11 times (37%), down 19 ten sessions later. That’s quite a bit worse than the 59% random odds. Average gain and loss were both around 2%. The last two occurrences saw the S&P move sharply higher, and in both cases the S&P never traded below the signal week’s close. If you’re looking for that to happen again, you wouldn’t want to see any selling pressure this coming week.

SPX 52wk High Intraweek, Closes Week Down 1%+
07/16/21… SPX ??? two weeks later
06/18/21… SPX +4.5% two weeks later
01/29/21… SPX +5.9% two weeks later
12/11/20… SPX +1.1% two weeks later
09/04/20… SPX -3.1% two weeks later
02/21/20… SPX -11.0% two weeks later
01/24/20… SPX +1.0% two weeks later
07/19/19… SPX -1.5% two weeks later
08/11/17… SPX +0.1% two weeks later
01/02/15… SPX -1.9% two weeks later
05/24/13… SPX -0.4% two weeks later
04/05/13… SPX +0.1% two weeks later
05/06/11… SPX -0.5% two weeks later
04/30/10… SPX -4.3% two weeks later
01/22/10… SPX -2.3% two weeks later
12/31/09… SPX +1.9% two weeks later
07/20/07… SPX -6.6% two weeks later
06/08/07… SPX -0.3% two weeks later
12/22/06… SPX -0.1% two weeks later
05/12/06… SPX -0.9% two weeks later
03/11/05… SPX -2.4% two weeks later
01/07/05… SPX -1.5% two weeks later
11/19/04… SPX +1.8% two weeks later
01/07/00… SPX -0.0% two weeks later
07/23/99… SPX -4.2% two weeks later
04/30/99… SPX +0.2% two weeks later
04/16/99… SPX +1.2% two weeks later
02/05/99… SPX -0.0% two weeks later
07/24/98… SPX -4.5% two weeks later
04/24/98… SPX +0.0% two weeks later
04/09/98… SPX -0.3% two weeks later

Longer-term studies on the board reflect big buyers in the low SPX 4200’s, suggesting the market will find support in that area if last week’s selling does persist.