Market Studies for June 3, 2018: Amazon and NASDAQ


Here are today’s quantitative market studies. Facts and data are more important than blind faith.

Amazon

Amazon and Netflix have been leading the stock market higher. These 2 stocks have significantly outperformed the S&P 500 year-to-date.

Amazon is now up 7 days in a row. Historically, what happens next to Amazon?

Click here to download the data in Excel.
Conclusion
Amazon will probably close higher the next day (i.e. go up 8 days in a row). But this study is a short term bearish sign for for Amazon. See Amazon’s 2 week forward return.

NASDAQ is leading the S&P

Tech stocks and small caps are leading the stock market’s rally, while large cap slow-growth stocks (i.e. Dow) are underperforming the stock market’s rally. The NASDAQ is now less than 0.5% away from its all time high even though the S&P 500 is still more than 4% below its all time high.

Here’s what happens next to the S&P 500 (historically). We’ve excluded the overlapping cases over the past 3 months.

Click here to download data in Excel.
Conclusion
This is neither a bullish nor bearish sign for the stock market. This is why we don’t put too much emphasis on which sectors lead/lag for predicting the stock market’s future performance.

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