There appears to be a bit of an inclination to follow through on the gap to the upside. Most of the instances were quite volatile, and all of them pulled back at least 0.4% below the open at some point during the day. Most of them also took place during 2008 when volatility (both intraday and overnight) was elevated.
Monday, August 22, 2011
Big Gaps Up After 2 Strong Days of Selling
After 2 hard days of selling the SPY looks to be gapping up strong this morning. I looked back at other times that the SPY gapped up big after 2 large down days. Below are the results since 2003 of buying all instances at the open and then selling at the close.
There appears to be a bit of an inclination to follow through on the gap to the upside. Most of the instances were quite volatile, and all of them pulled back at least 0.4% below the open at some point during the day. Most of them also took place during 2008 when volatility (both intraday and overnight) was elevated.
There appears to be a bit of an inclination to follow through on the gap to the upside. Most of the instances were quite volatile, and all of them pulled back at least 0.4% below the open at some point during the day. Most of them also took place during 2008 when volatility (both intraday and overnight) was elevated.
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