A lot of the movement in stocks over the past few trading sessions has happened overnight. During the past 5 days, the overnight gaps have totaled 13.14% which is something SPY hasn’t done since October 2008. What’s interesting is that over the last two days we’re finally seeing some buying taking place between 9:30 and the close. Today was the first back-to-back days since October 2014 that SPY closes 1% higher than the open. Before that you have to go back to October 2011.
As you can see on the chart, these strong back-to-back days occurred at previous market bottoms. While this might be interesting, I wouldn’t be too quick to infer that what meant something in the past will have any relevance this time around. It’s almost never that easy.
Michael Batnick is a managing partner at Ritholtz Wealth Management. He is the co-host of Animal Spirits, What Are Your Thoughts, and The Compound and Friends. For disclosure information please see here.