There are a lot of frustrated investors that got wrong-footed following the November 8 election. However, there was a brief dip the morning after the election, and there have been some pauses/dips in this Del Shannon “Runaway” stock market. And a runaway market it has been, at a day count of 26. Recall that “buying stampedes” typically last 17 to 25 sessions with only a one-to-three session pause/pullback before they tend to exhaust themselves on the upside. It just seems to be the rhythm of the thing in that it takes that long to get everyone bullish just in time to make a top. While some stampedes have lasted 25 to 30 sessions, it is fairly rare to have one extend for more than 30 sessions. That said, in the spirit of “markets can do anything,” the longest stampede chronicled in my notes of some 50 years ended on June 8, 2016, at session 82. The next-longest lasted 43 sessions and before that the longest was 38 sessions. So even though this stampede is long of tooth by day count standards, Andrew and I have not given up on it. Also worthy of consideration is that the NYSE McClellan Oscillator is pretty oversold (see the chart).
Del Shannon?
December 16, 2016
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