If History is Any Guide….more than one “markets muse” should be running for cover, faster than if they found themselves strolling the streets of NYC’s Chelsea neighborhood this past Saturday evening. And, one global macro muse is extending that warning..
Stock market technicians, i.e. those who hang their hats on technical analysis and the notion that history tends to repeats during select times of the year should take note of the following statistics; if history is any guide, professional traders should sell every rally, now!
Why? Aside from the fact that the month of September is notorious for market tops and arguably, the most damaging sell-offs in US equity markets followed soon thereafter, the month of October in years ’29, ’87, ’91, , ’01* ‘ and 08 to cite just a few), professional chartists are reminded by a illuminating observation courtesy of global macro guru Neil Azous in the a.m. notes published by Rareview Macro’s “Sight Beyond Sight”:
Gann Day: Per legendary Wall Street trader W.D. Gann, September 22nd is the date markets top more frequently than any day of year. This year that date coincides with the Fed and BoJ meetings on Sep 21st. Stock Trader’s Almanac : S&P 500 down 22 of 26 during week after September options expiration, average loss 1.08% (Full Stats HERE, @AlmanacTrader)
S&P 500 Seasonality: This week is the 38th week of the year. This is the worst week of the year since 1950 and the S&P 500 has been down 7 of past 8 years. Last week was Sept Options Expiration. Since 1990, the week after this has higher only 4 times past 26 years. Higher only 15.4%, lowest for any week of year.
Those having glasses half full, or those whose glasses use bifocal lenses might argue “even a broken clock is right twice a day, that doesn’t mean lightening strikes at the same place at the same time..” will discount the above. On the other hand, “Many People Are Saying” that those who are familiar with fall stock market falls will want to follow Azous on Twitter, or better and smarter still, those who are global macro aficionados should grab themselves a subscription to Sight Beyond Sight by clicking this link.