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< BACK TO ALL REPORTS

Ugly open

Jason Goepfert
2020-12-21

The S&P 500 is on track for the typical indigestion following the swallowing of a large new member. Indications are currently for about a 1.5% gap down.

Allowing for some wiggle room, this would mark one of the largest gap down opens in December for SPY. 

The positive seasonal bias seemed to help a bit, with mostly positive returns. But most of those also occurred during very volatile conditions during downtrends, pretty much the opposite of what we're seeing today.

When a big gap down has triggered within a week of a 52-week high, forward returns from the open were less kind.

And when those occurred on the first trading day of a new week, all 5 signals showed a negative return at some point in the following days. Small sample size, though.

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