Below is a look at how the S&P 500 has traded on an intraday basis so far this year. In the chart, we show the index's average intraday pattern in the first quarter compared to its average pattern so far in April. Trading in the first quarter was marked by strong opens followed by very weak afternoons, with stocks usually rolling over between 1 PM and 2 PM and closing near their lows on the day. On average, highs for the day came around 10:15 in the first quarter.
So far in April, on average we have seen bigger pops following the open and highs for the day at almost the exact same time during the morning. Interestingly, though, while the first quarter saw significant weakness in afternoon trading, we have seen buying in the afternoon this month. As shown below, in April, the S&P has drifted lower from its highs around 10 AM until around 1:30 PM, and then it has seen a nice pop in the final hour of trading. This indicates more of a willingness to hold stocks overnight, which is a good sign. There's an old Wall Street adage that "the dumb money trades at the open, while the smart money trades at the close." Bulls are hoping there's some truth to that.
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