Daily Commentary - Posted on Friday, March 27, 2009, 8:14 PM GMT +1

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Mar Friday 27

Friday's sessions mirrors Thursday's session

FRIDAY’S SESSION MIRRORS THURSDAY’S SESSION

Thursday’s session was already remarkable due to the fact that the S&P 500

  • posted a higher open,
  • posted a higher high than the previous session’s high,
  • posted a higher low than the previous session’s low,
  • posted a low above the previous session’s close,
  • posted a higher close,
  • and finally closed above the open.

(see my posting Trading the Odds on Friday – March 27, 2009)

but -going into the final hour- Friday’s session (at least as I type this post) seems to completely mirror Thursday’s session due to the fact that the S&P 500

  • already posted a lower open,
  • already posted a lower low than the previous session’s low,
  • up to now only posted a lower high than the previous session’s high,
  • up to now only posted a high below the previous session’s close,
  • currently would’ve posted a lower close,
  • and would currently close below the open.

Unfortunately -from a statistical point of view-  those may be disappointed expecting that this time probabilities and odds would favor a bullish  (intraday) tendency for Monday’s session mirroring the (expected) bearish tendency for today’s session (with the exception of a probable higher open).

Since 01/03/2007, there were 84 occurrences which fulfilled the setup with those (bearish) ‘6lows listed above, thereof 51 with a higher open on the next session than the previous session’s close (as today’s close will probably be), and 33 sessions with a lower open. The respective probability of 60.71% for a higher open on Monday’s session would hence be significantly above the respective at-any-time probability of 41.56%, BUT the respective probabilities for a higher high (22.61%) are significantly below and those for a lower low (76.19%) are significantly above the respective at-any-time probabilities for a higher high (48.05%) and lower low (50.65%), forecasting (at least a temporary) intraday weakness for Monday’s session.

From a statistical point of view Monday’s session may see a bullish start with a probably higher open, but loosing steam after the open to probably post a lower low during the session. The probability for a higher/lower close is comparable to the respective at-any-time probability.

The column ‘w/Survey I‘ shows the respective figures concerning the setup mentioned on top of the post (and the S&P 500’ behavior the next session), ‘w/Survey II‘ -for comparing purposes- the respective figures concerning those sessions posting a lower close only (that means the S&P 500’ behavior the session after the S&P 500 posted a lower close, not the session with the lower close, and not taking into account any lower open, lower high, lower low …, but a lower close as the one and only condition).

survey-20090326-5

(click on image to enlarge)

Successfull trading,

Frank

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