How Seasonality Has Changed

By Tom McClellan

Annual Seasonal Pattern Now vs Earlier

We all know about the factor of seasonality, and especially about how it is distilled into the bit of TV news wisdom, “Sell In May and go away”.  That phrase has been around for decades, originally supposedly referring to traders in England who would “Sell in May and go away, and come back on St. Leger’s Day”.  This referred to the custom of aristocrats, merchants, and bankers who would skip town and go to the country during the hot months, returning for the St. Leger’s Stakes, a horse race held in mid-September.  Source: Investopedia.

It just happens to be a fun rhyme for the U.S. stock market, minus the St. Leger’s Stakes reference, but only during the past couple of decades.  Years ago, seasonality did not work that way, which is what I explore with this week’s chart.

Continue reading How Seasonality Has Changed

Why Seasonality “May” Be Bullish Today

By Rob Hanna

The 1st trading day of the month is often a bullish day for the market. In the past I have broken down the tendency by month. And since 1987 May has produced the most profits. Below are results for May dating back to 1987. (Note performance is measured on a close to close basis.)

2018-05-01

Stats here are strongly lopsided in favor of the bulls. Winning %, win:loss ratio, profit factor, and average trade are all outstanding. Perhaps the saying should be “Sell in May, but not the 1st day!”.

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