Gaps Galore As Another Streak Ends


  • Jason Goepfert

    Jason Goepfert

    Published: 2018-02-08 at 17:25:56 CDT

This is an abridged version of our Daily Report.

Gaps galore

Heading into the peak in January, stock futures were gapping up almost every day. Now, they’ve gapped down at the open almost every day, tied for the most in history over an 8-day span.

Other tight clusters of gap down opens led to positive returns with one major exception.

Another streak gone

The S&P 500 ended its streak without a 1% daily change almost two weeks ago.

The streak was one of the longest in history, and now we’ve seen 5 moves of more than 1% since the streak ended. That’s the most ever, with only the 1960s seeing a few similar streaks ended with a sudden bout of high volatility.

Futilities

We’ve looked at the Utilities sector a few times over the past several months. In November, it looked like they might turn from utilities to “futilities” after a spike in 52-week highs and a negative reversal. It was another bad sign in December when they sunk down to the 200-day average for the first time in a while, and then again in January when they diverged so negatively from the Industrials...now it's getting so bad it should be good.

For access to the full report, indicators, charts, screens, and Backtest Engine, log in or sign up for a free 30-day trial today.

The post titled Gaps Galore As Another Streak Ends was originally published as on SentimenTrader.com on 2018-02-08.

At SentimenTrader.com, our service is not focused on market timing per se, but rather risk management. That may be a distinction without a difference, but it's how we approach the markets. We study signs that suggest it is time to raise or lower market exposure as a function of risk relative to probable reward. It is all about risk-adjusted expectations given existing evidence. Learn more about our service , research, models and indicators.


Follow us on Twitter for up to the minute analysis of market action.