S&P Watch: Looking for a Short-Term Pop
History could repeat itself here.
One was yesterday.
The other time was March 11, 2004, near a decent low for stocks.
The small number of new lows is impacted by the sharp rally off the March low, and the fact that bonds have held up well lately (there are quite a few interest-rate sensitive issues on the NYSE), but still I think that it's a positive indication overall.
When we go back to 1965 and look for any time that the S&P hit a 2-month low when the percentage of new 52-week lows on the NYSE was less than 1%, then over the next one or 2 weeks the S&P was higher 73% of the time, with an average return several times greater than random.
It was a relatively short-term positive only.
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