The Most Bearish Calendar Day, Statistically SpeakingJuly 21st is historically the least likely calendar day to close at a higher price than it opened.
Published in the Stock Trader's Almanac are the historical probabilities of each calendar day finishing in the green. The majority of calendar days range from 40% - 60%, and are more or less evenly distributed throughout different weeks in any given month. However, there are certain seasonally bearish or bullish weeks of the calendar year that consistently contain one or more calendar days in a row that are negative (positive),
One such week happens to be the current week, aka the week of July following the July witching session.
During this week, recent history suggests near-extreme levels of volatility when compared with the relatively quiet weeks that proceed it. Uncommonly large price swings in either direction have been seen to occur more often than not over the past 21 years.
Most stunningly, over the same 21-year study, it appears that one particular calendar stands above all others when it comes to being anomalously bearish. That day would be, drumroll, please...
The 21st of July aka tomorrow!
Across the main equity indices in the US, we have had an abysmal showing in terms of percentage positive days on July 21st since 2000:
Dow: 14.3%
S&P: 19.0%
Nasdaq: 14.3%
While I still need to cross-verify this with at least another data source before I bet the house, farm, family and kids tomorrow, it is a fact that no other calendar day is even remotely as bearish as July 21st is.
To put these probabilities in perspective, there aren't any other calendar days that are positive fewer than 30% of the time across all the major indices.
In conclusion, I'd find it amusing (unless I bet the farm, kids, etc.) if tomorrow becomes one of those irrationally bullish bounces that we've gotten used to over the past seventeen months.
-PigBetsTheFarm
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