Is Friday Like MoonDay?

Feb 10, 2000

There is an old belief in the trade that there is a 4 calendar day pattern in the markets, due to the Moon. While the pattern was know decades ago, it has been popularized in recent years by Welles Wilder ( The Delta Phenonomen) and more recently by Ron Prince.

Any such pattern should be checked out well before use. A thorough check should include at least 100 pattern comparisons, and should be done mathmatically, not by eyeball. But it is often of use to start with an eyebal comparison of 10 or so patterns to get an idea of whether doing the programming to compare patterns might payoff.

Since the Chaos Clinic is done on Fridays, the 4 day pattern says, "Friday will be like Monday." Does it work? Let's take a look.

The chart above is a Monday. This chart is just my TOMORROW'S MARKET EMAIL chart saved. We are only interested in the left half.

Rally to 10:30,decline to 2:30,rally to 3:20,decline into the close. Yes You Can... Cash In On Chaos!

Friday: Similar pattern, but 10:30 was a swing low. Did get a decline to 2:30, and a rally to 3:20 but no decline into the close. Give that one a B.

Above is a Monday. Early low, then nice 7 move up Chaos Clamshell. Yes You Can... Cash In On Chaos!

And here is Friday. The low came earlier, but it was followed by a 7 move up Chaos Clamshell. Give that one an A.

OK. Here is Monday again. Up to 11:20, down to 1:20, up to 3:20. Yes You Can... Cash In On Chaos!

Down to 9:50, up to 11:30, down to 12:15, up to 1:15, down to 3:20. Not a great pattern match, but some times are close. Give that one a C.

Monday again. High at 10:15, decline into 3:15 and a spectacular rally. Yes You Can... Cash In On Chaos!

Rally to 12:00, decline to 2:00, rally to 3:40, and a late drop. Didn't match Monday at all. Give that one an F.

Note that it did follow the -MoonTide very well.

Monday. High at 10:30, low at 1:00, high at 3:00. Yes You Can... Cash In On Chaos!

Friday: High at 10:15, low 10:55,high 1:00,low 2:40, high 3:10, low 3:25. Some similarity, but not great. Give that one a C-.

Monday. High at 10:20, low 12:05, high 12:40, then decline rest of day. Yes You Can... Cash In On Chaos!

Friday: High 9:55, low 10:20, high 12:00, low 1:00, decline to 3:40. So-so. Give that one a C.

Monday: Rally to 10:36, decline to 12:30, rally to 1:50,decline to 2:15, rally to 3:40. Yes You Can... Cash In On Chaos!

Friday: Sharp drop to 10:40, rally to 12:40, decline to 2:10, rally to the close. Opposite in the morning, good match in afternoon. Give it a B- for good times.

Monday: Narrow range and no trend. Yes You Can... Cash In On Chaos!

Friday: Narrow range and no trend! Give that one an A.

Monday: low at 11:00,high 1:20,low 2:20,high 3:20. Yes You Can... Cash In On Chaos!

Friday: early close. high 10:40,low 11:00, high 12:20,low at early close. No match at all. Flunk that one.

Monday: Rally to 11:40, decline to 12:40,rally to 3:05,decline to close. Yes You Can... Cash In On Chaos!

Friday: Rally to 10:55,decline to 12:00, rally to 12:55,decline to 1:20, rally to 3:05, decline to 3:50. Only the 3:05 drop matches. Give that one a D.

So where are we after a quick and admittedly dirty look? We have 2 A's. 2 B's, 2 C's, a C- , a D, and 2 F's. That averages out to a C-. So with just this quick look, I would look for something better. "Friday is like MoonDay" is just too simplified to work.

That's why I work to mathmatically model the markets. The markets are very complex. It is not easy to make money trading them. The patterns are constantly changing, and it takes a lot of work to compute them. This computation is not easy, but in the long run, it is probably the only approach that will work.