The next chart reveals three totally different calculations of the S&P 500’s seasonality […] one commonality is the V-shape into early October and out of it. That’s the reason why everyone seems to be speaking in regards to the weak point in September.
The next chart reveals the seasonality of all of the years since 1950. The seasonality solely touches the low of the chart as soon as, which signifies that over all these years, the market has at all times had one weak point on the identical time. The low occurs in late September, adopted by a considerable rally till January. The seasonality reveals some weak point into March, adopted by a response that ends initially of Could. After that, the seasonality, calculated with out a development element on this chart, goes down till late September. For this reason we regularly say, “Promote in Could and go away.”
The pink line on the next chart additionally reveals seasonality, however solely the final ten years have been used to calculate the outcomes. The conduct across the seasonal low in October appears to be like just like the seasonality in all years. I’ve, nonetheless, a second low in the course of March and a transparent prime in mid-July. This prime is just a few days after the one we skilled this 12 months. Apparently, the saying “Promote in Could and go away” wasn’t good recommendation over the past ten years, as we might have missed the rallies between March and mid-July.
The next chart compares the blue seasonality with the seasonality of the years ending with 4 (2014, 2004, and so on.). The low happens in early October, in comparison with the 2 earlier seasonalities, which have the seasonal low on the finish of September. The rally solely lasts till early November. However there’s a second rally instantly afterward, which lasts till late January.
Summary:
