Days since a 3% correction

Once again, this blog is based on a US blog which showed that Dow has had 600 days since seeing a 3% reaction. Since our markets are in itself in the middle of a good bull run, I figured out that it would be interesting to check out as to how many occasions we had seen a 3% reaction in Nifty as well as how many days had been spent from the time we had a 3% correction last time around.

Of the total of 5529 days of data I have, Nifty has seen a fall of 3% or more on 208 occasions. In other words, Nifty on an average has a 3% correction every 26.5 days. But then again, that is the average. Right now, we are 180 days from a 3% correction (last correction >3% was on 3rd September 2013) though this is not the biggest time frame we have had between such corrections. This is not even the 2nd longest but is as on date the 5th longest time between 3% or more correction.

But what interested me was not the days that we spend now but how the reactions were more often seen during the bull run of 2003 – 2008. In fact, the highest days between a 3% or more reaction then was 155 days (in 2006). The trend seems to have changed not in 2009 when markets shot up substantially but in early 2010. Would be interesting if this indeed is a change in terms of markets not seeing a substantial correction for more days than what has been the trend earlier.

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About Prashanth

Have been a full time participant in the stock markets since 1996. Run a Yahoo Group where focus is exclusively on discussions of the Indian Markets using Technical Analysis as the tool (groups.yahoo.com/group/technical-investor)
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