The Profit Magic of Recent Mondays

Nov 23, 2009: 12:27 PM CST

Over the weekend, I read an article at Phil’s Stock World written by Trader Mark entitled, “What the Heck is Going on with Mondays Lately?  Always Up!”  I initially had skepticism after reading about the recent tendency for Monday’s to be big up days, but after today’s action, I’m giving it a second look.

Here’s an updated chart as of Monday afternoon Nov 23 on the S&P 500:

(Click for full-size image)

Using TradeStation, I’ve colored each Monday since May purple (PaintBar) for comparison.

Of the 29 Mondays shown above:

20 Mondays up (12 were ‘large’)
6 Mondays down (4 were ‘large’)
3 were “dojis” or roughly unchanged

Trader Mark reported the following data:

“Of the last 8 Mondays, 7 were up, 1 was down, and the average gain of these “up-Mondays” was +1.28%.”

As of this writing just after noon EST, we are up almost 1.50%.

Great call by Trader Mark – he’s definitely on to something with the data!

As to why, data do not necessarily answer the “why” question, but the “what/how much” question.

Let’s see how long this string of up-Mondays can last and if this is a short-term trading edge or tendency.

Corey Rosenbloom, CMT
Follow Corey on Twitter:  http://twitter.com/afraidtotrade

4 Comments

4 Responses to “The Profit Magic of Recent Mondays”

  1. Dan de Man Says:

    Thanks for the article Corey! The Friday black candle for UUP was also long signal for the indices. Also confirmed by the VIX reversal on Friday. But the trading pattern looks a lot similar to last months topping pattern.

    Also looks like a good spot to swing short some indices and commodities.

    My 2 cents

  2. ngbstl Says:

    I dunno if the “Mutual Fund Monday” is just a retro-fitting explanation or something valid, but pretty impressive.

  3. Dan de Man Says:

    Thanks for the article Corey! The Friday black candle for UUP was also long signal for the indices. Also confirmed by the VIX reversal on Friday. But the trading pattern looks a lot similar to last months topping pattern.

    Also looks like a good spot to swing short some indices and commodities.

    My 2 cents

  4. ngbstl Says:

    I dunno if the “Mutual Fund Monday” is just a retro-fitting explanation or something valid, but pretty impressive.