Showing posts with label Presidential Cycle. Show all posts
Showing posts with label Presidential Cycle. Show all posts

Sunday, March 24, 2024

S&P 500 March-April 2024 Seasonality │ Jeff Hirsch & Wayne Whaley

After 5 months of solid gains, are markets ready for a pause? Bullish Presidential Cycle Sitting President Pattern flattens out the mid-February to late-March seasonal retreat considerably without 2020 in the average.

 'Best Six Months' ends in April.

April is the final month of the “Best Six Months” for DJIA and the S&P 500. From our Seasonal MACD Buy Signal on October 9, 2023, through (March 21, 2024), DJIA is up 18.4% and S&P 500 is up 20.9%. Fueled by interest rate cut expectations and AI speculation, these gains are approximately double the historical average already and could continue to increase before the “Best Months” come to an end.


This AI-fueled bull market has enjoyed solid gains since last October and will likely continue to push higher in the near-term, but momentum does appear to be waning with the pace of gains slowing. With April and the end of DJIA’s and S&P 500’s “Best Six Months” quickly approaching we are going to begin shifting to a more cautious stance. We maintain our bullish stance for 2024, but that does not preclude the possibility of some weakness during spring and summer.
 
 
 
THE CORRELATION MODEL SEES A NEGATIVE LAST WEEK OF MARCH FOR THE S&P. Provided a time frame of interest, my correlation model calculates the Correlation Coefficients (-1 to +1) for the past performance of 4165 different time frames over the prior 3 months vs the performance for the time frame of interest in search of the period which has demonstrated the most barometric acumen in predicting the performance of the upcoming time frame of interest. 
 
This week I ask the model for it’s prognosis for the S&P in the last week of March. It responded that the prior ten calendar days (Mar10-24) had a very uncanny track record of forecasting the last week of March with those 2 time frames having a very strong NEGATIVE correlation which doesn’t bode well for next week given that March 10-24 was up 1.63% this year.  
 
Note the 3-10, March 24-31 performance in the far right category below in those 13 prior years where March 10-24 was greater than 1.2% for an avg wkly loss of 0.74% with 1% moves 1-7 to the downside.  This contrasts dramatically to the 11-2 performance when March 10-24 was less than -0.5%.  Fingers crossed that it is wrong this year. 
 
The outlook for April is much brighter. 
 
  
Reference: 
 
[ oftentimes true: ]
 
In Bull Markets, New Moons are Bottoms, and Full Moons are Tops. 
In Bear Markets, New Moons are Tops, and Full Moons are Bottoms.
 
The SoLunar Rhythm in March 2024.
 
 
 
 
 

Tuesday, March 19, 2024

Election Years Are Different | Tom McClellan

I have been writing about the Presidential Cycle Pattern since 1994, using the pattern which is derived from averaging together SP500 price data in 4-year chunks of time. One difference in how I do this versus others is that I start each 4-year period as of November 1 instead of January 1, to better align with election day. This week's chart looks at the differences (and similarities) in the versions of the Presidential Cycle Pattern depending on what type of president is in office. The green line reflects first term presidents from a different party than the last president, and reflects the condition we have now.

  » March is typically a sideways month, part of a larger sideways pattern 
lasting all the way until late May. The market normally rallies from June to election day. «

[...] A lot of the time, the two patterns behave very similarly. But in March of the election year, there is a notable difference. When a first term president is in office and running for reelection, March is typically a sideways month, part of a larger sideways pattern lasting all the way until late May. March is different, though, when a second term president is in office (red line). [...] The stock market normally rallies from June all the way to election day
[November 5] when there is an incumbent running for reelection. And usually an incumbent will win reelection. That is how things normally go.
 
Larry Williams identified June 2024 in the current decennial pattern
 as  » the sweet spot with 90% accuracy « to buy and hold until December 2025

[...] This year we have a challenger who is not an unknown quantity (to Wall Street), who at the moment has a slight lead in the polls. This type of condition is totally backwards from how election years usually go.  Add to that the additional unknowns about how President Trump is facing multiple trials for alleged crimes, and we have an election year completely unlike any previous one.  So trying to run a forecast model based on how things have gone in prior election years may just not work this year.
 

Friday, February 16, 2024

S&P 500 vs NAAIM Exposure Index │ ISABELNET

The National Association of Active Investment Managers Exposure Index represents the two-week moving average exposure to U.S. equity markets reported by NAAIM members.

 The NAAIM Exposure Index, with a reading of 95.58, indicates a strong bullish sentiment among active investment managers, reflecting their high confidence in the future trajectory of the stock market (published Feb 16, 2024).

 S&P 500 and NAAIM Index above 97 (published Feb 15, 2024)

Active investment managers are notorious for buying equities at tops and selling them at bottoms, highlighting the difficulties they encounter in accurately timing the market and making lucrative investment choices.

 
Still up: The 3 Day, the 9 Day and the 18 Day cycles vs the S&P 500 Index.
 
Jeffrey A. Hirsch (
Feb 16, 2024) - DJIA S&P 500 & NASDAQ are all up 7 of last 12 days after the Presidents’ Day, but long-term record remains weak. Since 1990, average performance ranges from –0.56% for NASDAQ to –0.28% for DJIA. 
Sizable declines in the last 2 years have worsened the record.

Tuesday, February 13, 2024

S&P 500 Seasonality Weak from Mid-February to Mid-March │ Jeff Hirsch

The big round number 5,000 is proving to be resistant. It will likely take a few attempts to break through. February’s notorious seasonal weakness is bound to relieve the market’s obviously overbought condition. This is not out of the ordinary for February even into March.

 
This usually mild retreat (around 4% on average) from mid-February to mid-March in election years with a sitting president running for reelection could be a good opportunity to establish new or add to existing positions. Election year seasonal patterns suggest respectable full-year gains. 

Tuesday, December 26, 2023

2024 S&P 500 Election Year Seasonal Pattern │ Jeff Hirsch

 2024 is an Election Year and the sitting President is running for office again. 
In this constellation the S&P 500 typically tends to (1.) trend higher from early January into mid February;  
(2.) decline into late March; (3.) rise up for the rest of the year, especially after elections.
Also take note of Larry Williams' re-election pattern.
 
The S&P 500's average annual return during Election Years is 11.6%. Since 1833 the fourth year in the Decennial Pattern has been up 13 vs 6 times down with an average annual return of 5.22%. Over the past 30 years, January gains have occurred 17 times (57%), while losses numbered 13 (43%), barely better than the flip of a coin. In bull markets, New Moons are bottoms, and Full Moons are tops. In bear markets, New Moons are tops, and Full Moons are bottoms. More often than not, stocks will rise from around the 7th to around the 14th calendar day of a month, fall from the 14th to the 20th, and rise from the 20th to the 25th.
 
In 1967 Yale Hirsch published the first Stock Trader’s Almanac and presented the Four Year Presidential Election Cycle as an significant and predictive indicator of stock market performance. The outcomes are relatively steady, regardless of the president’s political leanings in office at the time, and the year after each presidential election marks the start of a new four-year stock market cycle. Considering annual returns of each year in the four year cycle, the Pre-Election Year (2023) is considered best, and  the Election Year second. The most predictive period of the year is November 19th to January 19th. Wayne Whaley coined it a 'Turn of the Year (TOY) Barometer'. If the return of this 2-month period is greater than 3%, a bullish signal is given, and the market is very likely to do well over the following 12 months. If the return is 0-3%, the signal is considered neutral; and if the return is negative, the signal is bearish, and returns very poor. Currently the S&P 500 still trades some 6% above the November 19 level.
 

The 250 year US empire live cycle concluded in 2023. Demise by folly overstretch. Uni-polar global supremacy is over, and Russia, China and Iran stronger than ever. A multi-polar world of worlds now knows how to deal with a paper-tiger gone mad. All star-spangled striped monsters check-mated, defeated and unveiled 24/7 along the many battle fronts on the globe. Project Ukraine lost. Now supervising genocide in Palestine. Yemen's Ansar Allah controls the Bab al-Mandab and launches full front attacks against the hegemon. An emerging Muslim alliance will liberate the Holy Land. Iran may shut down the Gibraltar strait any moment. The Taliban will enter Jerusalem and flatten Tel Aviv. Zionist Saudis and emirs doomed. Revolutionary Shia will root them out. The fever pitch increases. As some discard all this as hysteria and Islamist war propaganda, the dollar hegemony is rapidly melting away under the world island's rising sun. 2024 will be a remarkable 'election year'. W.D. Gann projected 'major panic, breadlines, soup kitchens, despair, and unemployment' into the US of 2024. And US astrologer L. David Linsky sees the home-front ready for more mayhem, upheaval, war and regime change. Plenty of opportunities along the lines and times in the above seasonal roadmap for 2024.
 
 
The Kitchin Cycle and the Benner Cycle are bullish for all of 2024 and 2025 (historically the fifth year outperforming all other years in the decennial pattern). In the current decennial cycle Larry Williams identified June 2024 as "the sweet spot with 90% accuracy" to buy stocks until December 2025.
 
 
 
 
 
In January 2024 the Sensitive Degrees of the Sun are:
Jan 02 (Tue) = Earth at perihelion = positive = high
Jan 06 (Sat) = negative = low
Jan 19 (Fri) = negative = low
Jan 30 (Tue) = positive = high

The Turning points in the Geocentric Bradley Barometer are (+/-1 CD):
Jan 04 (Thu) = Low
Jan 13 (Sat) = High
Jan 22 (Mon) = Low
Jan 29 (Mon) = High

The SoLunar Rhythm during January 2024: 

 
Additional References:
Seth Golden (Dec 26, 2023) @ X
 
 Last time the S&P 500 was up 9 consecutive weeks was in 2004 and before that two 9-week win streaks in 1989 and in 1994,
before that a 12-week win streak in 1985. The next years' returns were:
1986 = 14%
1990 = -4.5%
1995 = 34%
2005 = 3%
 
 

Wednesday, December 20, 2023

2024 in the Four Year Election Cycle │ Dimitri Speck

 
Dow Jones, 4-year cycle, calculated over 121 years.

2024 is an election year. The election cycle suggests a weak first half of the year,  and a good second half. The election year gets off to a weak start. The left quarter of the chart shows the typical performance of the Dow Jones in election years. As indicated by the red arrow, these typically posted losses in the first half of the year. After that, things look much better, as indicated by the green arrow.

Quoted from:
Seasonax (Dec 13, 2013) - 4-Year Election Cycle: How will 2024 go?

Monday, December 18, 2023

2024 US Stock Market Outlook │ Larry Williams

 
Larry Williams' 2024 projection for US Stocks:
 
First week of January to last week of February - UP
 Last week of February to last week of April - DOWN
 Last week of April to last week of Juli - SIDEWAYS-TO-UP
First day to last day of August - UP
First week to third week of September - DOWN  
  Third week to fourth week of September new high of the year - UP
Fourth week of September to first week of November - SIDEWAYS-TO-DOWN  
 First week of November to first week of December - UP
 First week to third week of December - DOWN
 Third week to last trading day of December printing the yearly high - UP
 
The December 2023 Low is a key price level in Q1 of 2024. 
 
Larry Williams identified June 2024 in the current decennial pattern 
 as "the sweet spot with 90% accuracy" to buy and hold until December 2025.
 
 

Reference:

S&P 500 │ 2023 Still An Inside Year

 S&P500 (weekly candles)
The 2023 yearly target remains above the January 2022 high at 4,817. Price currently above Level 2 and above the July 2023 third quarter's high. 2023 is still an Inside Year, inside of the 2022 price range. The 2023 fourth quarter is an Outside Quarter. Eight trading days left before the year closes for another 120 to 140 points up into the Level 3 price target at 4,857 or even 5,000. From there a retracement down to around 4,587 - 4,440. The seasonal chart points to the 2023 high around Dec 26 (Tue). See also: The Yearly Market Maker Breakout Template.
 
S&P500 (4 hour bars)
Week Dec 18-25 sideways-to-up; Year-End-Rally early January 2024 high around 5,050. 
 

Tuesday, October 31, 2023

S&P 500 Pre-Election Year Seasonal Pattern For November 2023 | Jeff Hirsch


Being a bullish month, November has seven bullish days based upon S&P 500, with four occurring in the first five trading days of the month. This bullish stretch is visible in November’s seasonal chart with solid gains spanning the first six trading days. Following a strong open, the market has tended to drift sideways with some chop through mid-month and into the Thanksgiving holiday before rallying strongly to finish the month. Although historically a bullish month, November does have weak points. NASDAQ and Russell 2000 exhibit the greatest strength at the beginning and end of November. In pre-election years, performance in November has been softer, but full-month performance remains positive on average.
 

Wednesday, September 13, 2023

Sell Rosh Hashanah & Buy Yom Kippur 2023 | Jeff Hirsch

Sell Rosh Hashanah, Buy Yom Kippur is aligning quite well this year with late September seasonal weakness and the notoriously treacherous week after quarterly options expiration, AKA Triple Witching (Fri, Sep 15th). It’s a few days before FOMC (Tue-Wed, Sep 19-20) with a market jittery on hotter inflation data.
 

Rosh Hashanah lands on Saturday 9/16 this year so we close the day before. This is right at the mid-month peak of the typical September pattern. Yom Kippur falls on 9/25 (Mon) which is the 16th trading day of the month, right around the seasonal monthly low point.


The thesis is that folks sell positions on Rosh Hashanah the first of the Days of Awe to rid themselves of financial commitments and then return to the market after Yom Kippur, the Day of Atonement. It is no coincidence that this coincides with the seasonal September/October weakness. The market has been tracking the 4-year cycle and seasonal trends to a T this year and the past 3. So this should make a great entry for the Q4 pre-election year rally.