Longest Period in S&P 500 Since 1950 Without A Six-Day Win Streak

This coming Friday, October 28, 2016, will mark the longest period in S&P 500 since 1950 without a six-day win streak.

Last Friday, October 21, 2016, was a down day for the S&P 500 and this means that by Friday, October 28, 2016, there will be 595 trading days without a six-day win streak.  The 594-day win streak that ended October 9, 2009, will rank second, as shown in the chart below:

spx_6d_20161021

The 594-day period without a six-day win streak in 2009, was primarily due to the bear market of 2008 and ended when momentum increased due to the intervention of the central bank. This recent longest streak is due to volatility collapse combined with uncertainty about the future direction of prices.

A pattern of longer periods without a six-day win streak is evident from the above chart. One consequence of this pattern is that while prices rise over the longer-term, it is not possible to profit in the short-term by relying only on momentum.

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