Election Year Pattern - May Bottom?

Great chart on election years being choppy until May (or perhaps more precisely, until the contours of the coming election are clear).  We might have a clear pair of candidates by early Wed morning (John Wayne McCain and Barack "Yes We Can" Obama), but we may have to wait until the early-election dirt is exposed in the late Spring (Clinton did a number on Dole in 1996; Bush did a similar job on Kerry in 2004).  Patterns come and go and have no predictive power unless based on underlying causality.  Like the Four Year Presidential Cycle, which is driven by interference in the economy to get elected, this pattern is apparently driven by removal of uncertainty.  My thanks to Deacon (see reader comments here) for pointing this chart out. 

Comments

[Wavetrader]

Nice try but with breakfast I have "TOAST"and that's what the $ is and the stockmarket!

[I.Sosceles]

The technicals have us rising tomorrow at least 109 points on the Dow. Whether we close there is of little importance to a trader.

[deacon]

here's some stuff i'm seeing about march, since we've had 4 months in a row down there is value, how about a long from this week low to get out before the ides of march, as we're had multiple fairly horrible last 1/2 of months' previously in market history: The month of March historically has been an encouraging month for investors holding U.S. equities. The S&P 500 Index has advanced in 7 of the past 10 years for an average gain of 1.57%. March was the second best performing month of the year during the past 10 years. A longer term study completed by Standard & Poor’s starting in 1945 showed an average gain per period by the S&P 500 Index of 1.05%.(dvtechtalk) ...a decline in the S&P 500 Index during the January/February period (as experienced this year) frequently is followed by an advance in the Index during the March/April period. January/February declines have occurred on 11 occasions since 1957. The Index rose in 8 of the 11 March/April periods. (thackray)...new moon is on 3/7, and over the last year the market has made quite few highs during new moon time frame, then lows on full moon. (pesevento)

[LoneStarHog]

Oh Boy! Another Damn Chart!

Let me see...in what other election year within current memory did we have the following:

1) Complete credit/debt market meltdown
2) Complete home market meltdown
3) Roaring real inflation, not the U.S. Gubermint crap figures
4) Roaring unemployment, not the U.S. Gubermint crap figures
5) Historic meltdown of the U.S. Peso

Just some MINOR examples of what might make this STUPID historic chart MOOT!

LoneStarHog

Note: This is the SECOND time that that IDIOT Prechter has stated that Hillary would be the next president. Does that MORON ever get ANYTHING correct?

Note: Silver is roaring over $20.00. I remember in 2003 when silver went from $5.00 to $5.30. HACKberg said that it was the FINAL thrust up before silver reentered its Bear Market and headed well below $3.00

Note: Buy gold/silver and get outta anything/everything U.S. Peso denominated

[Contrary Fader]

Is it just me or has Yelnick blog suddenly become positive and bull friendly on stocks after years and years and years of bull bashing and google bashing.

This cant be a good sign.

[Lizz]

LoneStar is right: damn useless chart.

Lets talk about the real problems:

GEORGE MAGNUS, UBS, on a possible trillion dollar meltdown from the subprime crisis.
Senior economic adviser warns of more bad news to come
From:FT.com

http://video.aol.com/video-detail/george-magnus-ubs-on-a-possible-trillion-dollar-meltdown-from-the-subprime-crisis/903133267

[deacon]

here's historical by the day of year, click on march and see that the long should be NOW! (http://www.cxoadvisory.com/calendar/)
today QQQQ closed below 2/22 low of 42.78 on lower volume, so that's key number for longs to get above in the pre-market...COMPX undercut blood moon 2/6 low of 2252 and closed above, volume was lower so we have the 'spring' in place if recovers the 2/22 low of 2265...i didn't do much today as the world was in the 'puetz panic' last nite and still needs to prove it can stop the bleeding

[yelnick]

Fader, I just think this market has one more surprise in store. Neely thinks we are done, and of course so does Prechter. Tony Caldero has gone bearish after being a five-year bull (and calling it better than EWI). But I agree with LoneStar that a lot of the nominal Dow holding up is an illusion as the Dollar has dropped so much: 20% drop against a basket of currencies; should be higher but China/Japan/Saudi-Arabia hold to a close Dollar peg. Adjust the Dollar drop to 30%, adjust the Dow or S&P down 30%, and we are not really much off the lows in 2002.

[LoneStarHog]

Yelnick, what really gets on my nerves is when I constantly read about bull/bear markets being determined by Market Indexes, never adjusting for nominal/real.

My philosophy has always followed the KISS! (Keep It Simple, Stupid!) principle. So, I simply determine a bull market as one where I make REAL gains and a bear market where I don't.

What is required for the traditional definition of bull/bear market is a STABLE currency. The U.S. Peso has been a joke and is useless as a measuring stick. The only VALID stick is GOLD. As manipulated as the gold market is - and a VERY manipulated market - it is still a true reflection of market gains. The Dow/Gold Ratio serves this very well.

What is it about people that they can't see or refuse to see the ILLUSION created by an unstable currency, especially one that is being hyper-inflated?

Buy gold/silver and the PM equities, especially the Juniors, and get outta anything/everything U.S. Peso denominated.

LoneStarHog

[Eventhorizon]

LoneStarHog,

While I completely agree that a stable currency is required to measure real gains and losses (as well as a million other important things), you can't claim gold is a good yardstick for anything.

First you yourself claim it is a manipulated market (I don't happen to subscribe to that) so how can it be a valid yardstick - it's like a jiggered set of scales.

Second, to believe that gold is the ultimate indicator of inflation, you have to believe there was no inflation from 1980 through 2001. Is that realistic?