After shooting up 3.5% last Tuesday the S&P 500 has flat-lined. The chart might make you think there was a takeover announced last Tuesday morning of all 500 components. Volume has dropped each day as well.
I looked back over the last 30 years for similar price action. The only other time the market followed a gain of 3% or more with 3 consecutive closes within 0.25% of the close of the 3% day was December 3, 1982. By lowering the requirement of the surge day from 3% to 0.75% I was able to get a larger sample size. A summary of those instances is in the table below.
Below are the results if you eliminate the surge day all together and just require the coiling action to occur above the 10-day moving average.