Monday, August 29, 2016

charts: September Stock Markets

Courtesy of thepatternsite.com
Courtesy of thepatternsite.com
Possible Explanation By Investopedia
Since 1950, the month of September has seen an average decline in the Dow Jones Industrial Average (DJIA) of 1.1%, while the S&P 500 has averaged a 0.7% decline during September. Since the Nasdaq was first established in in 1971, its composite index has fallen an average of 1% during September trading. This is, of course, only an average exhibited over many years, and September is certainly not the worst month of stock-market trading every year.
There are several theories which attempt to explain this phenomenon. One particular theory points to the fact the summer months usually offer light trading volumes on the stock market, as a good deal of investors typically take vacation time and refrain from selling stocks from their portfolio. Once fall begins these investors typically return to work and exit positions they had been planning on selling. When this occurs, the market experiences increased selling pressure, and thus an overall decline.
*As well, many mutual funds experience their fiscal yearend in September. Mutual fund managers, on average, typically sell losing positions before year end, and this trend is another possible explanation for the market's poor performance during September.
Data from moneychimp.com
            Yrs  Yrs  Avg
Month  Up  Dn   Gain/Loss
Jan        39   26   +0.94%
Feb       37   28    -0.13%
Mar       42   23   +1.10%
Apr       44   21   +1.36%
May      37   28   +0.11%
Jun       33   32    -0.07%
Jul        35   30   +0.83%
Aug     37   28    -0.18%
Sep     29   36     -0.65%
Oct     40   25     +0.68%
Nov    43   22     +1.37%
Dec    49   16     +1.59%
The data above supports that September is the worst month of the year and that the best six months of the year is November to April.

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This has been posted for Educational Purposes Only.   Do your own work and consult with Professionals before making any investment decisions.  
Past performance is not indicative of future results

1st Day of the Month Gains

DJIA gains more on first day than all other days 

Over the last 15 1/4 years the Dow Jones Industrial Average has gained more points on the first trading days of all months than all other days combined. While the Dow has gained 5481.72 points between September 2, 1997 (7622.42) and December 31, 2012 (13104.14), 5323.19 points were gained on the first trading days of these 184 months. The remaining 3674 trading days combined gained just 158.53 points during the period. This averages out to gains of 28.93 points on first days, in contrast to only 0.04 points on all others. See Table 1.

Note that September 1997 through October 2000 racked up a total gain of 2632.39 Dow points on the first trading days of these 38 months (winners except for seven occasions). But between November 2000 and September 2002, when the 2000-2002 bear markets did the bulk of their damage, frightened investors switched from pouring money into the market on that day to pulling it out in fourteen months out of twenty-three. This netted a 404.80 Dow point loss. The 2007-2009 bear market lopped off 964.14 Dow points on first days in 17 months from November 2007 to March 2009. First days had their worst year in 2011, declining seven times for a total loss of 644.45 Dow points.

First days of June have performed worst. Triple digit declines in four of the last five years have resulted in the worst net loss. August is the second net loser. In rising market trends, first days perform much better as institutions are likely anticipating strong performance at each month’s outset. S&P 500 first days track the Dow’s pattern closely but NASDAQ first days are not as strong with weakness in April, August, and October.

Courtesy of Jeffrey A. Hirsch
 For more information contact
 JEFFREY A. HIRSCH, editor-in-chief of the Stock Trader's Almanac and Almanac Investor newsletter, and the author of The Little Book of Stock Market Cycles (Wiley, 2012).
 www.stocktradersalmanac.com

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This has been posted for Educational Purposes Only.   Do your own work and consult with Professionals before making any investment decisions.  
Past performance is not indicative of future results

Thursday, August 25, 2016

chart: SPY Buying Pressure Weakening

For those of you that have seen the Buying Pressure chart in the past you will see a pattern that repeats itself very often.  It tends to lead the market at turns.  For those of you that are not familiar with this chart, please look at past posts.

One easy way to find them is go to "Search This Blog" 
  Then enter "Buying Pressure"

This will get you a list of the posts and just click on them to review and get familiar with them.

Buying Pressure has started to have a negative divergence with the SPY daily chart.  Once this happens a caution light goes on.   Confirmations must follow before taking any actions.  Take a few minutes to go back and review some older posts.  It will be time worth spending and always wait for confirmations.

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Just submit your email address in the box on the Blog homepage
This has been posted for Educational Purposes Only.   Do your own work and consult with Professionals before making any investment decisions.  
Past performance is not indicative of future results

Picasso ST Cycle Dates

In this update only the dates will be mentioned with an "H" for high and a "L" for low.
The chart amplitude can and will be misleading at times.
In addition, it is the date that is most important rather than if that date is a projected high or low with amplitude as sometimes shown on the chart.
One important reason is because in some cases a date may invert and the amplitude and the "H" or "L" may not mean anything.
A low may actually turn out to be a high and visa versa.
Also it is very important that other tools always be used to confirm any potential ST Cycle Date.

Picasso Dates, always +/-
8/31-9/3* H
9/17 L
9/20-26 H
10/5-9 L

* Note that 9/3 is an Anniversary Date of the 1929 high on 9/3/1929



Keep following JustSignals using Twitter, @StockTwits or Follow By Email. Just submit your email address in the box on the Blog homepageThis has been posted for Educational Purposes Only.   Do your own work and consult with Professionals before making any investment decisions.  Past performance is not indicative of future results

Wednesday, August 24, 2016

chart: SPY & the Hi-Lo 10dma


The 10 Day Hi-Lo is flashing a caution light.  When the SPY makes a higher high while the 10 day Hi-Lo starts to drop, be on watch.  In the past divergences appear at most turns in the market.  At the very least, the 10 day Hi-Lo develops lower highs and lower lows at or near tops and higher highs and higher lows at or near bottoms.
This one down turn in the 10 day Hi-Lo is not by itself an indicator of a guaranteed turn, but, it is a warning that it should be carefully watched.

Buying Pressure has been falling also.   See the current post of Buying Pressure.

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This has been posted for Educational Purposes Only.   Do your own work and consult with Professionals before making any investment decisions.  
Past performance is not indicative of future results

Tuesday, August 23, 2016

chart: SPY Buying Pressure


For those of you that have seen the Buying Pressure chart in the past you will see a pattern that repeats itself very often.  It tends to lead the market at turns.  For those of you that are not familiar with this chart, please look at past posts.

One easy way to find them is go to "Search This Blog" 
  Then enter "Buying Pressure"

This will get you a list of the posts and just click on them to review and get familiar with them.

Buying Pressure has started to have a negative divergence with the SPY daily chart.  Once this happens a caution light goes on.   Confirmations must follow before taking any actions.  Take a few minutes to go back and review some older posts.  It will be time worth spending and always wait for confirmations.

Keep following JustSignals using Twitter, @StockTwits or Follow By Email. 
Just submit your email address in the box on the Blog homepage
This has been posted for Educational Purposes Only.   Do your own work and consult with Professionals before making any investment decisions.  
Past performance is not indicative of future results

Friday, August 19, 2016

7th & 9th Years of the Decennial Pattern

        

The above charts start from 1915 and go to the current year 2016.
Each decade is shown separately.  As you can see the 7th and 9th years have been highlighted in yellow.
The reason for this was to show that highs have been made in the 7th and 9th years of a decade.
In some cases a high was made in the 6th year as in 1916-17, 1946, 1956-57, 1966 and 1976-77.
Since the current bull market which started in 2009 is 7 1/2 years mature, it is likely that 2016-17 & 2019 may put a damper on the bull and give way to another bear market.

Keep following JustSignals using Twitter, @StockTwits or Follow By Email. 
Just submit your email address in the box on the Blog homepage
This has been posted for Educational Purposes Only.   Do your own work and consult with Professionals before making any investment decisions. 
Past performance is not indicative of future results