Since 1911, a losing streak of 9 or more days in the Dow Jones Industrial Average has occurred 26 times. Below are charts and statistics.
The Dow Jones Industrial Average (DJIA) last confirmed a 9-day losing streak on February 22, 1978.
As shown on the table below, the forward 21-day return back then was 1%.
The maximum number of consecutive losing days has been 12 and has occurred twice in the past.
Overall, the average 21-day forward return in the last 25 occurrences of 9 or more consecutive losing days has been 1.1%.
What is intriguing with the current losing streak is the long time lag from the previous one, which occurred in 1978. Apart from that, these random patterns do not have forecasting significance; they are outcomes of random price action.
As we have argued many times in this blog, descriptive statistics have limited forecasting power. They are enjoyable to monitor and analyze but overall useless for trading or investing in the markets.
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Charting and backtesting program: Amibroker. Data provider: Norgate Data
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