The S&P 500 has just posted back-to-back days of 90% or more advancing issues.
Here’s the chart:
Here’s a bonus table that highlights the S&P 500’s forward returns following back-to-back days of 90% advancing issues:
The Takeaway: Back-to-back days with 90% of advancing issues in the S&P 500 don't happen too often. This signal indicates that the bulls are still in the game! Since 2008, this has only happened nine times, and yesterday marked the tenth occurrence.
When we analyze the data, we see that the short term might be a bit choppy. However, as we know, volatility can lead to big moves in either direction. Historically, these large swings tend to cluster around the bottom points of market corrections.
On a positive note, when we look one year after this signal, we find that 88.9% of the occurrences have resulted in positive returns, with an average gain of over 16%.
Is this the first sign of a tailwind for the Bulls? Maybe…
I will be closely monitoring whether the bulls can maintain their recent leadership and achieve further follow-through in the coming days. While they still face challenges, this is a solid start for them to regain control of the multi-year bull market.
Grant Hawkridge | Chief Aussie Operator, All Star Charts
ICYMI: On Wednesday, JC and Steve be doing an Emergency State Of The Markets stream to coincide the Fed's rate announcement and post-game press conference. They will talk about where things stand and go over their Bear Market Checklist. You don't want to miss this.
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