We’re gearing up for a very active Q4!
As the United States heads into the November 2024 elections (and for those who incorporate seasonality “checkboxes” into their trading/investment plans), October can be a tricky month.
When we look at seasonality patterns and historical market performance, market professionals will commonly refer to “the best six months,” or the November-April time frame.
Looking at the S&P 500 monthly averages and % returns over the last 20 years, we can see why, with Nov-April % returns aggregately totalling 6.0% and May-Oct % returns totalling just 2.4%:
* Source EquityClock.com
Looking deeper into election years specifically, and breaking down monthly market performance through the entire month of October, we can see that the back end of October tends to start outperforming and picking up momentum leading up into November.
*Source Credit: Hirsch Holdings Inc./StockTradersAlmanac.com
So, incorporating these historical seasonality patterns into our trading/investing plans, we can probably expect a little up/down/sideways volatility during the course of October and until broader market conditions are generally more favorable going into the end of the month.
Like any trend, there’s only one place to find the best trade opportunities to capitalize on it:
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Happy Trading!
