Last night’s subscriber letter featured (an expanded version of) the following study, which looks at performance in the 1st couple of days following a positive 1st day of a new year.

The stats and curve all suggest some immediate follow-through has been typical. There have now been 10 winners in a row, with the last loser occurring in 1998. Also notable is that 26 of the 28 instances (93%) closed higher than the entry price on either day 1 or day 2. Interestingly, the 2 instances that didn’t, also didn’t manage to post a close above the entry price at any point during the rest of the month. Of course AAPL has already put the market in a bit of a hole, with SPY prepping to gap down over 1% as I type this.  So it may be more of a challenge to close up today or tomorrow than usual.

It is also notable that many instances saw a mid-month decline after the initial bounce, but that has not played out in recent times.

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