One interesting aspect of Friday’s action was the discrepancy between the NDX and the SOX. While the NDX rose 1.3%, the SOX declined 1.7% – which is very unusual action. Below is an updated study that looks at times the NDX rose by a least 1% while the SOX declined.
Six days later 76% of the instances were losers and the average occurrence was nearly a 3% loss. That seems to be a fairly substantial edge, and may be worth giving some considerations to. I should note that the majority of the studies I am looking at currently are leaning bullish. But if short-term bears want something to grasp onto, this may help with their case.
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