On a daily foundation the analog between S&P 500 closing costs of 1986 and 2024 had a 95% constructive correlation over the previous 180 buying and selling days, which is the interval for the reason that starting of 2024. In fact, solely time will inform whether or not this correlation continues. Nevertheless, the analog initiatives the upcoming swing highs and lows for the month of October to be kind of consistent with Jeff Hirsch’s common seasonal chart for October in election years and the composite chart for October returns in election years in the course of the fourth yr of the decennial cycle. From the newest all-time excessive of September 26, the subsequent swing low is projected to happen on October 9 (Wed), adopted by a excessive on October 18 (Fri), and a probably decrease low round October 23-25 (Wed-Fri). Then a rally is predicted to happen into November 29 (Fri). Notice that on this context, route is extra necessary than worth ranges. The average S&P 500 return throughout October was barely constructive between 1950 and 2023, with 45 up years and 29 down years, and a mean return of 0.75%.
Seth Golden is extraordinarily optimistic about 2025: “From September 2023 to September 2024, the S&P 500 has been up higher than 30%. Traditionally, when the S&P 500 >25% over the trailing 12 months or extra right into a price lower, shares have NEVER been decrease a yr later and up near +20% on common. There isn’t a comfortable touchdown if there isn’t a touchdown in any respect in 2025, and by all accounts the setup is obvious!” A possible fly within the ointment for all the above bullish outlook is Sergey Tarassov’s long-term cycle evaluation. He recommended that the 41-month Kitchin Cycle in US shares would peak between June and October 2024, and be adopted by a decline into December 2025-January 2026. That stated, from a narrower medium-term Hurst cycle perspective, August 5 marked the low of a 40-week cycle. The market is now trending upward towards the subsequent cycle’s peak, and the final quarter of 2024 could very effectively conclude with new all-time highs.
