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S&P500: A Snapshot By Quarters.

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    October 7, 2011

    I generally look at market charts in several periods: 5-minute, daily, weekly and monthly. Last week Todd Wagers, a reader in Seattle, sent me a couple of market charts based on quarterly data. He commented, “I think looking at a long term view of the markets is really important for people to see. Using a quarterly candlestick chart really gives an attractive chart to view for long term support, resistance, reversals and so on.”

    Todd is absolutely right. In fact, his email was quite timely, arriving shortly before my presentation at the Retirement Income Industry Association (RIIA) conference in Boston earlier this week. I added slide to my presentation with a quarterly chart of the S&P 500 since January 1995. I introduced it with a question: “Does this look like a random walk?” Here is the slide.



    Of course, this nearly seventeen-year period in market history has been one extreme trends. The bull market that began in 1982 had shifted in the high gear in the second half of the 1990s, the pattern since the Tech Bubble peak in 2000 has been one distance sequences of serial correlation.

    We have now experienced two consecutive negative quarters, something that, since 1995, has only occurred during cyclical bear markets. Perhaps this time will be different. But global financial pressures will no doubt continue to weigh heavily on the direction of equities.

    Images: Flickr (licence attribution)

    About The Author

    My original dshort.com website was launched in February 2005 using a domain name based on my real name, Doug Short. I’m a formerly retired first wave boomer with a Ph.D. in English from Duke. Now my website has been acquired byAdvisor Perspectives, where I have been appointed the Vice President of Research.

    My first career was a faculty position at North Carolina State University, where I achieved the rank of Full Professor in 1983. During the early ’80s I got hooked on academic uses of microcomputers for research and instruction. In 1983, I co-directed the Sixth International Conference on Computers and the Humanities. An IBM executive who attended the conference made me a job offer I couldn’t refuse.

    Thus began my new career as a Higher Education Consultant for IBM — an ambassador for Information Technology to major universities around the country. After 12 years with Big Blue, I grew tired of the constant travel and left for a series of IT management positions in the Research Triangle area of North Carolina. I concluded my IT career managing the group responsible for email and research databases at GlaxoSmithKline until my retirement in 2006.

    Contrary to what many visitors assume based on my last name, I’m not a bearish short seller. It’s true that some of my content has been a bit pessimistic in recent years. But I believe this is a result of economic realities and not a personal bias. For the record, my efforts to educate others about bear markets date from November 2007, as this Motley Fool article attests.