A 7-Day Winning Streak Is Bullish For S&P 500: This Historical Analysis Proves It

The S&P 500 Index has recently embarked on an impressive journey, notching seven consecutive sessions of positive gains, and it’s currently battling for an eighth.

As of 3:30 p.m. ET, the SPDR S&P 500 ETF Trust SPY was holding steady, recovering after experiencing early morning losses.

Should another positive close occur, it will mark the longest winning streak in precisely two years.

However, whether or not this transpires, it doesn’t seem to be a major game changer for the future potential of the stock market.

S&P 500 Winning Streak: How Will It Perform Next?

According to Ryan Detrick‘s analysis, which was shared on the social media platform X (formerly Twitter), a 7-day winning streak for the S&P 500 has historically been a harbinger of above-average returns in the months that follow.

This intriguing fact delves into the data dating back to 1990, shedding light on the potential implications of this extended period of positive gains.

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In the past 30 instances where the S&P 500 achieved seven consecutive days of gains, 25 of them resulted in positive one-year returns. This track record suggests that a prolonged winning streak tends to be a favorable indicator for the stock market’s future performance.

S&P 500 up 7 days in a row for the first time since Nov '21.

Overall, up 7 days in a row appears to see above avg future returns.

Be aware, the past 3 signals (all in '21) saw negative returns a yr later.

But 25 of the prior 27 (back to 1990) saw higher prices a year later. pic.twitter.com/ReinJVtjLE

— Ryan Detrick, CMT (@RyanDetrick) November 8, 2023

However, there is a twist in the tale. The most recent occurrences of a 7-day winning streak in 2021 deviated from the historical norm, as all three of them led to negative one-year returns.

Nevertheless, the historical data presents a compelling argument for cautious optimism. On average, since 1990, the S&P 500 has seen a 10.3% increase in the year following a 7-day winning streak.

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