• What Does October 2013 Have In Common With October 1987?

    by  • October 16, 2013 10:44 am • Quick Hits

    Now that I have your attention, the good news is I don’t see much of a chance of an ’87 like crash.

    The answer to that question is just yesterday the SPX closed above it’s 200-day moving average for 228 straight days, topping the 227 streak it had right ahead of the ’87 crash.  I tweeted this stat out last night and it had 30 retweets.  In other words, this was very popular, so I wanted to touch more on it.

    Here are all the longest streaks above the 200-day MA going back 40 years.
















    I don’t take this as bearish.  To me, these streaks can go much further, as you can see above.  The fact we continue to see total freak outs on just 5% pullbacks is very bullish.  If/when we drop 5% again and we don’t see panic, then I’d be worried.

    I’ve been in the bullish camp most of this year and clear back in August I went on CNBC saying we wouldn’t see any ’87 like crashes.  Back then (just as it was last week) many have been vocally expecting a big crash this October.  I still don’t see it.  Check out my overall market thoughts in the recent Monday Morning Outlook for more on this.