Courtesy of Doug Short’s Advisor Perspectives.
This morning’s unexpectedly strong jobs report cleared the launch pad for a market liftoff. The S&P 500 surged upward at the open and continued to rise at a subdued pace to a lunch-hour high. It then traded sideways until the final minutes, when a bit of buying near the close inched it above the lunch-hour high to close at its 0.86% intraday high, which is a new record close. (More on that jobs report here.)
The yield on the 10-year note jumped eight basis points to 1.59%, a clear pause in flight to treasuries that has been the general trend of 2016.
Here is a snapshot of past five sessions in the S&P 500.
Here is a daily chart of the index. Volume was unremarkable on today’s record close. The major ETF that tracks the index (the SPY SPDR S&P 500 ETF, not illustrated here) finished the session with trading volume that was 26% below its 50-day moving average.
A Perspective on Drawdowns
Here’s a snapshot of selloffs since the 2009 trough.
Here is a more conventional log-scale chart with drawdowns highlighted.
Here is a linear scale version of the same chart with the 50- and 200-day moving averages.
A Perspective on Volatility
For a sense of the correlation between the closing price and intraday volatility, the chart below overlays the S&P 500 since 2007 with the intraday price range. We’ve also included a 20-day moving average to help identify trends in volatility.
