Today marks the 20th day this year that the S&P 500 has seen a daily change of +/- 1%.
Here is the table listing the years with 20 or more +/- 1% daily changes in the first quarter:
Let's break down what the table shows:
The first column displays the years when the S&P 500 saw 20 or more daily changes of +/- 1%. The second column indicates the total count of these daily changes in the first quarter. The third column represents the return for each year. At the bottom, there is a statistical table.
The Takeaway: Volatility often results in significant market movements in either direction. Historically, these large daily fluctuations tend to cluster together during periods of market weakness.
We have done the math, and the stock market generally tends to perform better when the environment is quiet: When the S&P 500 moves less than 1%, and strong: When the stock market has 52-week new highs that are greater than new lows. Right now, the environment is noisy: The S&P 500 is moving more than 1%, and weak: 52-week new highs are less than new lows.
While we are in this type of environment, it continues to argue for caution until we see broad and sustainable strength.
Can the Bulls quieten down this market to regain control?
Grant Hawkridge | Chief Aussie Operator, All Star Charts
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