We're nearing a 10% correction in the NDX.
From the high recorded on January 3, the Nasdaq 100 had declined 9.5% to yesterday's close. The year's early action casts a negative bias for the first quarter and for the entire year. But it's early in the year and we should expect plenty of ebb and flow.
The acceleration of the Nasdaq decline, approaching 200 day average, the near 10% correction in the NDX, and the SP / Bond extremes seem to suggest a more pronounced showing from Snapper. I've highlighted a few historical patterns below. And since Tuesday is often viewed as a counter-trend day I've highlighted that day's significance as well.
1. Nasdaq futures decline by .75% or worse for four consecutive days. The next day finished higher 15 of 18 and last occurred on January 21, 2003. Four of the results preceded a Tuesday. All four were higher the next day and three days later.
2. Nasdaq futures post three consecutive 30 day low closes and the next day is Tuesday . There were just five occurrences and the next day was higher in four of five. The most recent occurrence was July 20, 2004.
3. Date is Tuesday and the Nasdaq futures post four consecutive lower closes. Again, there were 18 results and the index finished Tuesday higher 83.33% of the time and was higher three days later 77.78% of the time. The most recent occurrence was December 20, 2004.
4. SP / Bond have moved to opposite extremes. Here's the query: SP futures post four consecutive lower closes and the most recent close is at least a 30 day low close AND over the same period BOND futures post four consecutive higher closes with the most recent a 30 day high close.
There were just two prior occurrences. Admittedly, the query is very restrictive and I hesitate to place a high degree of importance on such few results. However, I was most intrigued by the significance of the two dates. The first occurred one day prior to the September 1998 low and the second just one day prior to the July 2002 low. The next day's bar is highlighted in the charts below.
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