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As a follow up to my post Sunday, Dividend Investing, And Why Positive Returns Are Likely in 2010, the current advance in the Dow Jones Industrial Average (^DJI) is below average in both magnitude and duration as compared to past rallies. The Chart of the Day chart service looked at the prior 27 market rallies since 1900. They note:

  • most major rallies (73%) resulted in a gain of between 30% and 150% and lasted between 200 and 800 trading days.

  • the current Dow rally (hollow blue dot labeled you are here) has entered the low range of a "typical" rally and would currently be classified as both short in duration and below average in magnitude.

Source: Chart of the Day


If company earnings reports meet or exceed expectations on the whole this reporting period, the market could continue to grind higher.

Source: Why Positive Returns Are Likely in 2010 - Part II