Answer:
The average return after a rise is understandably lower than after a fall as detailed in the previous question. Interestingly, though, if a stock has gained over the last few days, you would do better to avoid short-term bets. More specifically, after the S&P500 rises 5% over 5 days, the average return over the next 7 trading days is negative. You can expect a nominal gain only if you remain invested for at least 2 weeks (10 trading days). But this average return figure swells to 11.7% over a period of a year (252 trading days).
Given a change of Then over the next The average return is
+5% over 5 days 1 day -0.3%
+5% over 5 days 5 days -0.3%
+5% over 5 days 10 days 0.1%
+5% over 5 days 21 days 0.5%
+5% over 5 days 63 days 3.0%
+5% over 5 days 126 days 6.6%
+5% over 5 days 252 days 11.7%
It's pretty powerful to test the trend for yourself for Splunk stock. Would be great to hear how the results compare versus your own intuition