• Does A Weak Market After an Election Mean Anything? Sure Looks Like It.

    by  • November 15, 2012 10:44 am • Quick Hits • 0 Comments

    Well, the past six days since the election have been anything but fun for the bulls.  As I noted last week, the day after the recent election was one of the worst ever for a President.  In fact, Obama now has two of the worst five all time.  What was concerning is the previous four worst one day returns all produced negative returns till the end of the year.

    After yesterday’s bloodbath, we broke it down one more time – only this time we looked at the first six days after the election.  Maybe a little more time gives the market time to really give its opinion   Obama now has two of the worst four returns here, as the Dow is down 5.10% since last Tuesday’s close.

    Once again, the returns going out are rather bearish.  In fact, one, three, and six months later all are negative on average!  Now trust me, I know it isn’t ever this simple.  In fact, you could argue the recent weakness has more to do with the continued issues in Europe and potential Middle East issues than anything about a new President or fiscal cliff.

    Still, as the great Warren Buffet says, “In the short run, the market’s a voting machine and sometimes people vote very non-intelligently. In the long run, it’s a weighing machine and the weight of business and how it does is what affects values over time.”  The market is voting right now that it doesn’t like something and this historically hasn’t been a very bullish signal.


    Ryan Detrick is the Senior Technical Strategist at Schaeffer's Investment Research in Cincinnati, Ohio. He joined Schaeffer’s in 2003 and is a frequent speaker and writer on stock market and economic issues and is widely sought after by financial media for his expertise and commentary. Mr. Detrick is a common guest on CNBC, Fox Business, and Bloomberg Television and has been quoted in outlets such as The Wall Street Journal, BusinessWeek, USA Today, Reuters, the Associated Press, and others. With a decade of financial industry experience in the investment and financial services area, strengths include short-term trading with an eye toward timely technical- and sentiment-based trading opportunities, and advanced option trading strategies. Mr. Detrick received a BA in finance from Xavier University, an MBA in finance from Miami University, and has earned his Chartered Market Technician (CMT).


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