Best of the Week
Most Popular
1. Climate Change Mass Extinction - Birds, Bees and Bugs: Going Going Gone - Richard_Mills
2.A Purrrfect Gold Price Setup! - Peter_Degraaf
3.Who Finances America's Borrowing? Recession Indicator for Independent Thinkers Part 2 - F_F_Wiley
4.America’s One-sided Domestic Financial War - Raymond_Matison
5.Gold Price Summer Doldrums - Zeal_LLC
6.Two Key Events Will Unleash Gold - Jim_Willie_CB
7.Billionaire Schools Teacher in NAFTA Trade Talks - Richard_Mills
8.Get Out Of Crypto Cannabis Bubble Before It Pops and Move Into Bargain Basement Miners - Jeb_Handwerger
9.Stock Market Could Pullback for 1-2 weeks, But Medium Term Bullish - Troy_Bombardia
10.G7 Chaos, Central Banks and US Fed Will Drive Stock Prices This Week - Chris_Vermeulen
Last 7 days
Gerald Celente: Why You Still Need Guns, Gold, and a Getaway Plan... - 23rd Jun 18
Cheap Gold Stocks Bottom Basing - 23rd Jun 18
A Trade War Won’t Be Good for the US Dollar - 23rd Jun 18
SPX/Gold, Long-term Yields & Yield Curve 3 Amigos Update - 22nd Jun 18
Gold - How Long Can This Last? - 22nd Jun 18
Dow Has Fallen 8 days in a Row. Medium-long Term Bullish for Stocks - 22nd Jun 18
Trouble Spotting Market Trends? This Can Help - 22nd Jun 18
Financial Markets Analysis and Trend Forecasts 2018 - A Message from Nadeem Walayat - 21st Jun 18
SPX Bouncing Above Support - 21st Jun 18
Things You Need To Know If You Want To Invest In Bitcoin Now - 21st Jun 18
The NASDAQ’s Outperformance vs. the Dow is Very Bullish - 21st Jun 18
Warning All Investors: Global Stock Market Are Shifting Away From US Price Correlation - 20th Jun 18
Gold GLD ETF Update… Breakdown ? - 20th Jun 18
Short-term Turnaround in Bitcoin Might Not Be What You Think - 19th Jun 18
Stock Market’s Short Term Downside Will be Limited - 19th Jun 18
Natural Gas Setup for 32% Move in UGAZ Fund - 19th Jun 18
Magnus Collective To Empower Automation And Artificial Intelligence - 19th Jun 18
Trump A Bull in a China Shop - 19th Jun 18
Minor Car Accident! What Happens After You Report Your Accident to Your Insurer - 19th Jun 18
US Majors Flush Out A Major Pivot Low and What’s Next - 18th Jun 18
Cocoa Commodities Trading Analysis - 18th Jun 18
Stock Market Consolidating in an Uptrend - 18th Jun 18
Russell Has Gone Up 7 Weeks in a Row. EXTREMELY Bullish for Stocks - 18th Jun 18
What Happens Next to Stocks when Tech Massively Outperforms Utilities and Consumer Staples - 18th Jun 18
The Trillion Dollar Market You’ve Never Heard Of - 18th Jun 18
The Corruption of Capitalism - 17th Jun 18
North Korea, Trade Wars, Precious Metals and Bitcoin - 17th Jun 18
Climate Change and Fish Stocks – Burning Oxygen! - 17th Jun 18
A $1,180 Ticket to NEW Trading Opportunities, FREE! - 16th Jun 18
Gold Bullish on Fed Interest Rate Hike - 16th Jun 18
Respite for Bitcoin Traders Might Be Deceptive - 16th Jun 18
The Euro Crashed Yesterday. Bearish for Euro and Bullish for USD - 15th Jun 18
Inflation Trade, in Progress Since Gold Kicked it Off - 15th Jun 18
Can Saudi Arabia Prevent The Next Oil Shock? - 15th Jun 18
The Biggest Online Gambling Companies - 15th Jun 18
Powell's Excess Reserve Change and Gold - 15th Jun 18
Is This a Big Sign of a Big Stock Market Turn? - 15th Jun 18
Will Italy Sink the EU and Boost Gold? - 15th Jun 18
Bumper Crash! Land Rover Discovery Sport vs Audi - 15th Jun 18
Stock Market Topping Pattern or Just Pause Before Going Higher? - 14th Jun 18
Is the ECB Ending QE a Good Thing? Markets Think So - 14th Jun 18
Yield Curve Continues to Flatten. A Bullish Sign for the Stock Market - 14th Jun 18
How Online Gambling has Impacted the Economy - 14th Jun 18
Crude Oil Price Targeting $58 ppb Before Finding Support - 14th Jun 18
Stock Market Near Another Top? - 14th Jun 18
Thorpe Park REAL Walking Dead Living Nightmare Zombie Car Park Ride Experience! - 14th Jun 18

Market Oracle FREE Newsletter

5 "Tells" that the Stock Markets Are About to Reverse

Stock Market Study: What Happens Next when Dow Goes Up 8 Days in a Row

Stock-Markets / Stock Markets 2018 May 15, 2018 - 06:02 PM GMT

By: Troy_Bombardia

Stock-Markets

The Dow Jones Industrial Average has gone up 8 days in a row (using CLOSE $). What’s unusual is that this is happening before the Dow has hit a new all-time high. These “up 8 consecutive days” events usually happen when the stock market is making new highs.

Here are the historical cases in which the Dow closed higher 8 days in a row, and what happened next to the stock market (Dow and S&P 500).

*This is a rather common event, so we’re only looking at the historical cases in this current bull market, which began in March 2009.


  1. May 14, 2018 (current case)
  2. August 3, 2017 (ended up being 10 consecutive days)
  3. February 21, 2017 (ended up being 12 consecutive days)
  4. July 19, 2016 (ended up being 9 consecutive days)
  5. March 12, 2013 (ended up being 10 consecutive days)
  6. February 9, 2011
  7. March 18, 2010
  8. August 27, 2009

*This is a SHORT TERM market study. The Dow going up 8 days in a row tells us nothing about what the stock market does during the medium-long term. It only tells us what the stock market will do next in the short term.

August 3, 2017 (ended up being 10 consecutive days)

The Dow ended up rallying 10 days in a row. It then made a pullback that lasted approximately 1 month. The S&P 500 did likewise.

February 21, 2017 (ended up being 12 consecutive days)

The Dow ended up rallying 12 days in a row. It then made a pullback that lasted approximately 1.5 months. The S&P 500 did likewise.

July 19, 2016 (ended up being 9 consecutive days)

Once this “8 days up” streak was broken, the Dow made a big pullback that lasted 3 months (this came close to being a “small correction”). The S&P 500 did likewise.

March 12, 2013 (ended up being 10 consecutive days)

The Dow ended up closing higher 10 days in a row. Then it consolidated sideways over the next month before trending higher. The uptrend was choppy. The S&P 500 did likewise.

February 9, 2011

The Dow and S&P soon began 6%+ “small corrections”.

March 18, 2010

The Dow and S&P rallied for 1 more month before starting “significant corrections”. The Medium-Long Term Model predicted these “significant corrections”.

August 27, 2009

The Dow and S&P immediately made a pullback.

Conclusion

With the Dow closing higher 8 days a row, now is not the best time to buy stocks if you missed the February/April 2018 bottom. There’s a high probability that the stock market will at least make a small pullback. The short term risk:reward is skewed towards the downside.

Read Stocks on May 15, 2018: outlook

By Troy Bombardia

BullMarkets.co

I’m Troy Bombardia, the author behind BullMarkets.co. I used to run a hedge fund, but closed it due to a major health scare. I am now enjoying life and simply investing/trading my own account. I focus on long term performance and ignore short term performance.

Copyright 2018 © Troy Bombardia - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Troy Bombardia Archive

© 2005-2018 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules