Similar to what the manipulated markets experience almost every Monday, the first day of each month is also pumped to the skies. Just who is behind this suspect activity can easily be deciphered by looking at the bottom chart.

Regards - VHF

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First Trading Day of the Month: Another 1% Gain?

B.I.G.

February 28, 2011

Tomorrow marks the start of a new month, and the big question once again for traders is will the recent trend of rallies on the first trading day of the month remain in place?

Since the start of 2010, the S&P 500 has finished the first trading day of the month higher in twelve out of fourteen months (86%). Additionally, the S&P 500 has risen more than one percent on the day nine out of fourteen times (64%). Since the start of December, there have been five days where the S&P 500 was up more than 1%, and three of those came on the first trading day of the month.

The first trading day of the month has had such a large impact on the equity market recently that if it wasn't for that day, instead of being up 18.3% since the start of 2010, the S&P 500 would only be up 2.3%! In the chart below, we show the performance of the S&P 500 since 2010 and break out the returns based on just the first trading day of the month as well as all days except the first trading day of the month. As shown, nearly all of the S&P 500's gains since the start of 2010 have come on the first trading day.

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You guessed it...

Click to enlarge: http://tinyurl.com/5wf48rp