Thursday, July 31, 2014

* Putting The SPX 2% Drop into Perspective: This May Shock You... Because It's Not Shocking

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Let's put context around today's 2.0% loss in the SPX. First, here are the daily returns in the SPX since 6-30-2013, ordered from lowest to highest.

Provided by Yahoo! Finance & Charles Schwab optionsXpress

I do note that while there have been 5 days of -2.0% returns or worse, there has only been one up day of that magnitude.

We can see that today was bad, but not sooooo bad.  In fact, there have been four worse days in the last 13 months and three worse days in just 2014. Here are the top 10 largest gains and losses on a daily basis in SPX over the same period.

Provided by Yahoo! Finance & Charles Schwab optionsXpress

Is a bear market coming (or already started)?  Maybe... I mean, I ain't long and the violent shift in momentum (Read: Collapsing Market Momentum in 3-charts) is definitely noteworthy.

But, was today crazy-crazy bad?... Not really...

One last thing to note: July was a down month, but that should not have been a big surprise. Remember this post from June 25th, 2014:

* 10 Facts that May Rock Your World: Has the Last Year Been an Artificially Driven Stock Rally?

This is trade analysis, not a recommendation.

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