Friday, April 15, 2011

Sell in May and Go Away ? or Buy Yom Kippur, Sell Passover ?

Next week on the close of April 20th we will look at the daily MACD (12,26,9) for both the DJIA and the SPX...If the MACD is on a sell for both then according to Sy Harding we sell the position that was entered into last Fall 2010...
If the MACD is not on a sell signal for both, then wait until there is one and sell your long position...
Years ago Yale Hirsch founder of the Stock Trader's Almanac (see article below) did back testing and found that the best months to hold stock was from November through April...
Sy Harding and others found a way to fine tune the buy and sell during that period with the use of oscillators...On October 16th if the daily MACD (12,26,9) is on a buy signal you go long...If not you wait until the daily MACD changes to a buy signal...On April 20th if the daily MACD is on a sell signal you sell your long position...If not you wait until the daily MACD changes to a sell signal...
Sy Harding has had an excellent return using this one strategy over many decades...
In fact if you followed this strategy it would have kept you out of the 1987 crash, the 9/11/2001 crash, the 2008 crash and more recent it would have gotten you out in the second half of April 2010 before the May 2010 flash crash...
I am sure that there are many investors still trying to break even from the damage of the 2008 crash.
I highly recommend the book "Beat the Market the Easy Way" by Sy Harding.   You will learn many more strategies like this one from a seasoned investor...

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Yale & Jeff Hirsch

About the Editor
Jeff is editor in chief of the Almanac Investor newsletter Stock Trader's Almanac, StockTradersAlmanac.com, and the Hirsch Organization. He makes frequent appearances on CNBC, CC, Fox, and Bloomberg. Yale Hirsch is founder of the Stock Trader’s Almanac.

Market Exodus – Bought Yom Kippur? Remember to Sell Passover
By Jeffrey A. Hirsch

                   Last year on September 10, market behavior around Rosh Hashanah and Yom Kippur was examined in a post titled “Sell Rosh Hashanah, Buy Yom Kippur, Sell Passover” noting that going long from Yom Kippur to Passover was very similar to the “Best Six Months” strategy which is be long November to April. Yom Kippur was on Saturday September 18, 2010. Going long at the close of the market on the day before through yesterday has been particularly profitable this year as the DJIA has gained 15.8%.
Read full post


Past performance is not indicative of future results.

4 comments:

  1. both are on sale today ..correct?

    ReplyDelete
  2. Yash...

    Yes the daily macd...thx...I corrected that...

    Yes both are on a sell as of today...BUT...for purposes of this strategy, today doesn't count...only the close of April 20th counts...

    ReplyDelete
  3. yep ..understood .. just becuase your wording was end of next week, some may get confused with weekly macd.

    ReplyDelete

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