December is better than November in Pre-election years for the most part. Weakness in the beginning will lead to a good run in the end of the month.
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Usually Octobers turn back on the bullish signals for the market. In pre-election years Octobers can be very weak, however.
September gets no respite from positive pre-election year forces. Positive year returns going into what becomes a bad August leads to a better chance of September being a decent month, however.
Jerome Powell and the rest of his Federal Reserve Board Members face tough decisions in 2023 as structural supply chain challenges keep inflation rates intolerably
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.
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.
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.
April is historically a great month for stocks. However, in mid-term election years like 2022, its just mediocre.
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.
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