Trump’s tweets on Sunday have put the market in a state of disarray. After closing Friday at an all-time high, QQQ is set to gap down nearly 2% this morning. Below is a look at other times QQQ gapped down at least 1% to open the day after closing at a 200-day high the day before.
Instances are quite low. It is very rare to see the market gap down such a substantial amount after posting a new high. There is also no real consistency among the results. To increase sample size, I also looked at 1% gaps down from 50-day highs.
Numbers here are not overwhelming. With only a sample size of 15 this does not appear to be a compelling edge. But they are a little disheartening if you are hoping for an immediate bounce on Monday morning. It is obviously a bit more suggestive of a further selloff than it is a rally.
Related Quantifiable Edges Studies
- Large SPY Gaps Down From 50-Day Highs: Open-to-Close Drift Study
- Unfilled SPY Gaps Down from 50-Day Highs: A Short-Term Bearish Setup
- Intraday Performance After SPY Gaps Down 4% or More (Since 1993)
- Large SPY Gaps Down After 3 Up Days: Open-to-Close Bearish Edge
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