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Bull Run Slowing Down?


The patterns remain bullish over the intermediate term but short-term patterns suggest a pullback of some kind is imminent.


The indices have had quite a run over the last month. The patterns remain bullish over the intermediate term but short-term patterns suggest a pullback of some kind is imminent.

Friday marked the seventh consecutive higher close in a row for the S&P 500. In the history of the S&P 500, we have come into the Monday after Thanksgiving with a seven day run just one time before. That was 1986 and the SPX closed -.07% (but posted an intraday low of down more than 1%). Also, the index has recorded 7 higher lows on the daily chart. Into the Monday after Thanksgiving, we've seen this just twice before (1978 and 1996). The closes were mixed but the intraday low for each was -.65% or worse. Okay, forget the holiday, when was the last time we had more than 7 higher closes? This time last year, the index recorded 9 consecutive higher closes and we saw a run of 8 up closes in September and March 2003.

S&P 500

  • The SPX has now gone one month (20 days) without posting at least a -.75% intraday low from the prior day's close.
    • There were several occurrences prior to November 1996, so there's no reason to say the streak can't continue. We've seen this just three times before: Jan 2004 (-1.5% over next 3 days), Nov 1996 (continued 7 more days through month's end and then declined for five consecutive days to start the month of December) and February 1996 (streak extended 2 more days before the SPX declined 5 days in a row).


  • Five consecutive weeks without at least a .5% drawdown from the prior week's close.
    • In its history, we've seen this just four times. This last occurred (and number of weeks in the streak): Aug 1993 (6), Jan 1994 (5), Dec 1995 (5), and Dec 2003 (7).


  • Nasdaq-100 recorded the 15th straight day with a low above the 10 day average.
    • This was not a valid sell prior to the March 2000 high. But since then, we've seen this just three times (Jan 2004, Nov 2004, and Aug 2005). The longest of the three was August 2005 which lasted 17 days. The index made a high on that day and then declined 4% over the next 3 weeks.

Remember, past performance doesn't always indicate future results.

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