Quantifying Frustration

How do you quantify frustration with the market?  The chart below may help.  Recently it seems that every time the market has an up day, it goes down the next day by a greater amount than it was up.  Based on a historical analysis of this scenario, the last 50 days are about as annoying as they get for the bulls. 

As shown below, an up day followed by an even greater down day has happened 15 times in the last 50 trading days.  Since 1940, this is easily the most times it has happened in this short of a time period.  And looking at the trend over the long term, it seems as though this scenario has been happening more and more since the start of the decade. 

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Comments

[Dan Horowitz]

One would think this is a natural side effect of volatility.

[lmccoll]

The lack of the uptick rule! That is obviously the difference.

[McLarty]

You guys rock, so creative. Good work.

[San Fran Sam]

so then to explain the market recovery from 2003 to 2007 despite what this chart shows, that would mean that there would be two up days where the advance was greater than the big down day that followed.

for example, Monday up 10, Tuesday up 10, Wednesday down 12. so you still get a net up 8. and the bull market continues despite a down day bigger than the last up day.

[Jon So]

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