33 replies to this topic

[pdx5]

This should cheer up the bulls.

 

Dow Jones Market Data found that in Octobers that follow a 7% or larger fall in September, the S&P 500 rises 0.53% on average in October and sees a median gain of 1.81%. That’s better than the average for all Octobers at 0.47% and the median at 1.03%. October is positive in years following an outsize September loss 54.55% of the time, versus 57.45% for all Octobers (see table below).

S&P 500 Category 7% or worse Sept All Septembers Average 0.53% 0.47% Median 1.81% 1.03% Worst Performance -16.94% -21.76% Best Performance 16.30% 16.30% % of October’s higher 54.55% 57.45%
   

 

 

 

[pdx5]

Seasonal patterns, however, are only a guide. As MarketWatch’s Isabel Wang noted in a Friday report, many strategists are skeptical of October’s reputation as “bear killer.” They argued that a macroeconomic environment dominated by central banks aggressively tightening monetary policy in a bid to wring out inflation is likely to overshadow favorable seasonal factors.

[Waver]

How many Octobers have there been down for the whole month?

[K Wave]

It's likely going to be fairly easy to determine likely October direction.

 

Since bears are in accelerate or die mode on this swing leg, bears likely only rule October if VIX jumps over 35 PDQ and stays there for long enough to do serious price damage, as the the most serious price damage is usually done with VIX over 35.

 

And it is indeed a huge drop from this particular cliff edge, should the bulls should fall off. So it makes total sense that it would be accompanied by huge VIX numbers.

If instead it comes back under 28 first few days of October, then the cliff edge retest will likely hold for a least a bit longer.

 

I personally think the bears are going to keep driving with Mega Caps and VIX well into October, but certainly willing to flip and play for a bounce if conditions dictate.

 

With the current multi-day indecision pattern on Rusty, we may very well have our answer to whole month by Monday.

[K Wave]

And eerily enough...FTSE appears to have a nearly identical long term monthly pattern to Value Line Geo, except a bit weaker on the last ramp.

 

And it also appears that the move down may just be getting started looking at momo.

 

Edited by K Wave, 01 October 2022 - 05:26 PM.

[K Wave]

One of the "last cars" UNH perhaps in for a rough ride in October?

 

Certainly has the last gasp up with fading momo look to it.

Perhaps shareholders start to get nervous about the political sea change sweeping the globe in October?

 

[K Wave]

Another last car LMT sure starting to get the 3 Drive Top look to it after September turn down.

 

We are all aware of how brutal drops after 3 drive tops can get.

 

[K Wave]

And the debt fueled Granddaddy of them all, last car AZO.

 

3 drive look on weekly, and Monthly lookin' like it may be ripe for an epic drop.

 

 

 

[MDurkin]

On January 3, 2001 the Fed pivoted from 6.5 percent to 6.0 percent. It took 13 rate decreases to get to 1.00 on June 25, 2003. On Sept 18,2007 the fed pivoted from 5.25 to 4.75 percent. It took 10 decreases to get to 0.25 on Dec 16,2008. Just because the Fed makes a pivot does not mean it is a bottom in the stock market. If this is like these 2 times we have a long way to go.

[pdx5]

On January 3, 2001 the Fed pivoted from 6.5 percent to 6.0 percent. It took 13 rate decreases to get to 1.00 on June 25, 2003. On Sept 18,2007 the fed pivoted from 5.25 to 4.75 percent. It took 10 decreases to get to 0.25 on Dec 16,2008. Just because the Fed makes a pivot does not mean it is a bottom in the stock market. If this is like these 2 times we have a long way to go.

Good to know! Thanks for posting this gem.

 

My gut feeling is FED has not even  reached the top federal funds rate yet, because inflation is NOT transitory.

I expect at least 2 rate increases during next 2 meetings. So long as unempolyment stays record low, there is little chance inflation drops quickly.

Edited by pdx5, 01 October 2022 - 08:57 PM.