Best of the Week
Most Popular
1. Climate Change Mass Extinction - Birds, Bees and Bugs: Going Going Gone - Richard_Mills
2.A Purrrfect Gold Price Setup! - Peter_Degraaf
3.Who Finances America's Borrowing? Recession Indicator for Independent Thinkers Part 2 - F_F_Wiley
4.America’s One-sided Domestic Financial War - Raymond_Matison
5.Gold Price Summer Doldrums - Zeal_LLC
6.Two Key Events Will Unleash Gold - Jim_Willie_CB
7.Billionaire Schools Teacher in NAFTA Trade Talks - Richard_Mills
8.Get Out Of Crypto Cannabis Bubble Before It Pops and Move Into Bargain Basement Miners - Jeb_Handwerger
9.Stock Market Could Pullback for 1-2 weeks, But Medium Term Bullish - Troy_Bombardia
10.G7 Chaos, Central Banks and US Fed Will Drive Stock Prices This Week - Chris_Vermeulen
Last 7 days
Trump Fee-Fi-Foe-Fum Declares European Union America's Enemy! - 16th Jul 18
US Stocks Set For Further Advances As Q2 Earnings Start - 15th Jul 18
Stock Market vs. Gold, Long-term Treasury Yields, 10yr-2yr Yield Curve 3 Amigo's Update - 15th Jul 18
China vs the US - The Road to War - 14th Jul 18
Uncle Sam’s Debt-Money System Is Immoral, Tantamount to Theft - 14th Jul 18
Staying in a Caravan - UK Summer Holidays 2018 - Cayton Bay Hoseasons Holiday Park - 14th Jul 18
Gold Stocks Summer Lows - 14th Jul 18
Trump US Trade War With China, Europe Consequences, Implications and Forecasts - 13th Jul 18
Gold Standard Requirements & Currency Crisis - 13th Jul 18
Focus on the Greenback, Will USD Fall Below Euro 1.6? - 13th Jul 18
Stock Market Outlook 2018 - Bullish or Bearish - 13th Jul 18
Rising Inflation is Not Bearish for Stocks - 13th Jul 18
Bitcoin Picture Less Than Pretty - 13th Jul 18
How International Observers Undervalue the Chinese Bond Market - 13th Jul 18
Stocks Trying to Break Higher Again, Will They? - 12th Jul 18
The Rise and Fall of Global Trade – Redux - 12th Jul 18
Corporate Earnings Q2 2018 Will Probably be Strong. What This Means for Stocks - 12th Jul 18
Is the Relative Strength in Gold Miners to Gold Price Significant? - 12th Jul 18
Live Cattle Commodity Trading Analysis - 12th Jul 18
Gold’s & Silver’s Reversals’ Reversal - 12th Jul 18
The Value of Bitcoin - 11th Jul 18
America a Nation Built on Lies - 11th Jul 18
China, Asia and Emerging Markets Could Result In Chaos - 11th Jul 18
Bullish Gold Markets in the Big Picture? - 11th Jul 18
A Public Bank for Los Angeles? City Council Puts It to the Voters - 11th Jul 18
Yield Curve Inversion a Remarkably Accurate Warning Indicator For Economic & Market Peril - 11th Jul 18
Argentina Should Scrap the Peso and Dollarize - 11th Jul 18
Can the Stock Market Close Higher For a Record 10th Year in a Row? - 11th Jul 18
Why Life Insurance Is A Must In Financial Planning - 9th Jul 18
Crude Oil Possibly Setting Up For A Big Downside Move - 9th Jul 18
BREAKING: New Tech Just Unlocked A Trillion Barrels Of Oil - 9th Jul 18
How Trade Wars Penalize Asian Currencies - 9th Jul 18
Another Stock Market Drop Next Week? - 9th Jul 18
Are the Stock Market Bulls Starting to Run? - 9th Jul 18

Market Oracle FREE Newsletter

5 "Tells" that the Stock Markets Are About to Reverse

Stock Market “Sell in May and go away” Study When Stocks Are Down YTD

Stock-Markets / Stock Markets 2018 May 03, 2018 - 03:20 PM GMT

By: Troy_Bombardia

Stock-Markets

As you probably know, “Sell in May and go away’ states that the stock market is seasonally weak from May – September. We already demonstrated that it isn’t as weak as investors think in this study.

Some investors believe that May-September is not seasonally bearish IF…

  1. The stock market falls from January – April, AND…
  2. There’s no recession that year (a recession in 2018 is highly unlikely).

Are they right? Let’s look at what happens next to the U.S. stock market from May-September when

The S&P falls from January – April…

And the S&P isn’t in a recession that year (a recession in 2018 is highly unlikely)

Here are the historical years.

  1. 2018 (present case)
  2. 2005
  3. 2004
  4. 2002
  5. 2000
  6. 1994
  7. 1992
  8. 1984
  9. 1977
  10. 1966
  11. 1962
  12. 1952

Here’s what happened next

2005

The stock market went up from May-September. It also went up from October – December.

 

2004

The stock market was flat from May-September. It went up from October – December.

2002

The stock market went down from May-September. It also went down from October – December.

2000

The stock market was flat from May-September. It went down from October – December.

1994

The stock market went up from May-September. It was flat from October – December.

1992

The stock market was flat from May-September. It went up from October – December.

1984

The stock market went up from May-September. It also went up from October – December.

1977

The stock market went down from May-September. It also went down from October – December.

1966

The stock market went down from May-September. It went up from October – December.

1962

The stock market went down from May-September. It went up from October – December.

1952

The stock market went up from May-September. It also went up from October – December.

Conclusion

From May-September:

  1. 4 cases went up
  2. 3 cases were flat
  3. 4 cases where down

From October – December:

  1. 7 cases were up
  2. 1 case was flat
  3. 3 cases were down

As you can see, “sell in May and go away” is neither consistently bearish nor bearish. It’s random. The probability of the stock market going up from May-September = the probability of the market going down from May-September. It doesn’t matter what the S&P was doing from January – April.

By Troy Bombardia

BullMarkets.co

I’m Troy Bombardia, the author behind BullMarkets.co. I used to run a hedge fund, but closed it due to a major health scare. I am now enjoying life and simply investing/trading my own account. I focus on long term performance and ignore short term performance.

Copyright 2018 © Troy Bombardia - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2018 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules