December: A Slow Starter
With greater than 5% gain in the main US indexes in both October and November this year, December is expected to start slow and then gain steam as the Santa Clause Rally comes to town.
October Bear Killer?
October is known as the ‘bear killer’ month. In US mid-term election years it can provide especially strong returns. With the economy faltering and inflation still too hot, investors are skeptical. We wait for confirmed bullish signals as markets set up for a bounce.
Mid-Term Matters
The US presidential election cycle last four years and shows definitive patterns historical that point to weakness in the first half of the second year. This leads to a run up in Q4 following thru to Q1 of year 3. This is known as the ‘sweet spot’ for investors.
September: Out of the Woods?
The summer rally has impressed as the major averages pushed back to their respective 200-day moving averages, a key technical level where they stalled last week. Now they are testing new short-term support around the June highs and the 50-day moving averages. Investors are clearly not out of the woods yet.
May is Worse
May shows poor performance in mid term election years, especially in the mid part of the month.
April Powers
April is historically a great month for stocks. However, in mid-term election years like 2022, its just mediocre.
Forecasting a Recession
What is the probability now of a recession? With employment optimism pitted against inflation pessimism, we look at the odds.
Cold War 2.0
A surprising Russian invasion in Ukraine has thrown the world back to a Cold War status. Mid-term election years are when these types of political and economic upheavals usually reveal their ugly heads. Going forward the market will work to find a bottom during a likely volatile year for investors.
March Relief
In mid-term election years, US markets perform generally well in March. Leadership in small caps stocks is discernible.
February Seasonality
February has been getting lousier for investors. The first half is usually better than the second. Utilities and High Tech start bullish seasonal trends soon.