Buzz & Banter
One of the more consistent seasonality biases seen in the market is positive action the last day of the month and the first few days of the new month. For instance, on the last trading day in July (which happens to be today), the S&P 500 has closed higher, 68% of the time since 1950. The next day (the first trading day in August, which is tomorrow in this case), the S&P has closed higher 51% of the time.
What's interesting, however, is that if the S&P bucks its positive seasonality and closes lower on the last day in July, then there has been only a 24% chance that the first day in August will close positively. Conversely, and more apropos to today's market, if the S&P kicks into high gear and closes up more than 1% on the last day in July, then the first day in August has also closed higher 80% of the time, with an average return of 0.3%. We can't read too much into that last statistic, however, as there have only been 5 occurrences, but it at least hints that today's positive bias (if it holds into the close) could continue tomorrow. Obviously, the econ numbers due tomorrow will have infinitely more impact than some arcane statistics, but the market may have some wind at its back if this positive action continues.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Daily Recap Newsletter