Market loss is 3x faster than market gain

I knew this but wanted some data to back it up. This is why I love the shorts.
Even on a intraday basis I'm sure this is true.
I'm still looking for that data.
Enjoy

https://seekingalpha.com/article/31...cks-really-drop-3-times-faster-than-they-rise

 

Google 'length of bull and bear markets', or break out the charts and see for yourself.

 

I read somewhere that it was 1.8 not 3.

 

The article I put a link on says it's three times. Whatever it is I just know from experience that things fall apart much faster than they go up. I am positive it is driven by fear. We all understand what panic selling is I don't think there such a thing as panic buying

 

There is, but by another name. It's when the cleaning lady buys a stock that's going to triple to where she'll never have to scrub another floor. Or the fund manager who envisions his name at the top of the list. And when the brokers say "This will be your last chance to buy at these prices!!" But the biggest clue is when nobody is looking for advice on ET!!

 

It does not. That's the question asked in the article.

In the conclusion, he says:

"In conclusion, my data suggests that during typical market activity, SPY does not fall 3 times faster than it rises."

As far as I know, the biggest intraday move in the last 6 years was an up move with a magnitude of 120 points in the ES in August 2015.

Down moves can be swift and excellent, but in my experience, the up moves offers just as much. At least in recent years.

 

The problem with that is the big up moves normally come after egregious declines. That is to be expected, and in my book does not count. The saying is that 'the market goes up via the stairs, but comes down the elevator', that is largely true. To eliminate dead-cat bounce effect, I think a better metric would be like: How many times the market has moved up +3% in one day to new (3-month?) high v. how many times it has moved down -3% to new lows. There is no question in my mind that the down moves will swamp out the up moves.

 

Doesn't sound logical to me.

Your filter with new highs and lows would take some more time to account for, but just looking at daily change for 2010 to the middle of 2016:

>= 3 % = 12 days

<= -3 % = 15 days

So, a slight skew to the down side.

Based on memory or hard data?

I wouldn't trust my own memory.

The point I'm trying to make is that my experience and data suggest that the up moves certainly are comparable to the down moves, both in size and speed.

 

Or put another way, the market takes the stairs up and the elevator down.

 

Ditto!

Of course we all know "the down moves are fast and furious". Also true of the up moves at times.

Overall, that "down moves are always much faster than up moves" is more urban myth than fact.

IOW... you're a fool if you trade without stops.