Courtesy of Doug Short.
The S&P 500 traded the day in a miniature zigzag reminiscent of yesterday’s pattern. The pre-market announcement of an October bounce in Retail Sales had little impact on the early trade, and the strong preliminary Consumer Sentiment report for November, the highest since July 2007, was only good for a 15 minute three-point rally that quickly evaporated. The index hit its -0.20% intraday low around 2 PM and then slowly rose to its 0.02% closing gain … enough for another record high, the seventh record close in eleven sessions.
The yield on the 10-year Note ended the day at 2.32% down 3 bps from yesterday’s close and unchanged from last Friday.
Here is a 15-minute chart of the week.
Here is a weekly chart of the SPY ETF, which gives a better sense of investor participation, which has declined as the market has risen following the October mini-selloff.
A Perspective on Drawdowns
How close was the October dip to an “official” correction, generally defined as a 10% drawdown from a high (based on daily closes)? The chart below incorporates a percent-off-high calculation to illustrate the drawdowns greater than 5% since the trough in 2009.
For a longer-term perspective, here is a pair of charts based on daily closes starting with the all-time high prior to the Great Recession.
