However, the U.S. stock market has been exceptionally strong this September despite starting with some short term weakness. In other words, it has completely ignored “sell in May and go away” from May – September this year.

When the market ignores bearish seasonality, forward returns are very bullish.

This is simple and logical. If the market goes up when it “should go down”, imagine how much higher the market will go up when it “should go up”.

This is what happens next to the S&P 500 when it makes a new all-time high in September. 1950-present

This is what happens next to the Dow when it makes a new all-time high in September. Data is more limited: 1970 – present.

Conclusion

This study suggests that the stock market will do well in the next 3 months. Might even go BOOM. If it does, that will be a terrific Christmas present.

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By Troy Bombardia

BullMarkets.co

I’m Troy Bombardia, the author behind BullMarkets.co. I used to run a hedge fund, but closed it due to a major health scare. I am now enjoying life and simply investing/trading my own account. I focus on long term performance and ignore short term performance.

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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