The following is what I consider to be a very interesting presentation of why the next week may be far weaker than would otherwise seem probable.
Keeping in mind that “past performance is no guarantee of future performance” and, even more importantly, history almost never repeats exactly, I find the following table of interest:
“Throw out the baby with the bath water” days in which almost none of the S&P 500 (SPX) stocks advance are very rare. In the entire 21st Century, this has happened only seven times. On September 1, 2015, only 3 of the 500 SPX stocks advanced. One week later was yesterday. Let’s look at the period from one week after the “bath water” day to one week after that: From close to close, the average DECLINE was 2.84%, with five of the six previous cases showing a decline and only one an advance. But if one looks at the period from one week after the “bath water” day to the low of that second week, the average decline was 6.86%, and the ONLY advance was a negligible 1/20% in 2010. If 2015 follows history (and that definitely is an “if”), then a 6.86% decline from 1969.41 would be 1834.31, sometime between today and September 15.
Thanks for the opportunity to be of service, and I’ll email you again later today regarding our open position.
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