In the October 20th, 2014 Seasonal Forecaster newsletter I started off taking a look at the seasonal pattern (the track record) of the NASDAQ Composite and the Russell 2000 indexes over the next 4 months. For example, the NASDAQ, for the 18 week period from the start of last week, has gained an average 9.6% each year over the past 24 years.
I mentioned the QQQ (ETF) as being one of the best ways to play the seasonal rise in the NASDAQ and I displayed a trade simulation showing what a good trading system this approach, all by itself, would have made. The average gain for instance could have been 16.9% each year the QQQ went up, and the average gain/loss for each trade, including the losses, was 10.7%.
So far, the Q's have gained 6.1% in the 5 trading days since that article. Technical analysis does not show any indication that this current rally may near an end, other than we've had a near-vertical 6% or so rise in just 7 trading days.
All the major indexes have good seasonal patterns right now. Even the Dow. DIA, the SPDR Dow Jones Industrial Average ETF, over the next 9 weeks, has had only one loss, of a measly 0.9%, over the last 16 years:
While news events in individual days may knock the markets around a bit, unless a major negative event happens, the stock market has a strong tendency to post gains through the end of the year and is likely to do so again this year.
Of course, there's much more you need to know and many more stocks you can capitalize upon each and every day. To find out more, please click on the following link: www.markettamer.com/seasonal
By Gregg Harris, MarketTamer Chief Technical Strategist
Copyright (C) 2014 Stock & Options Training LLC
Unless indicated otherwise, at the time of this writing, the author has no positions in any of the above-mentioned securities.
Gregg Harris is the Chief Technical Strategist at MarketTamer.com with extensive experience in the financial sector.
Gregg started out as an Engineer and brings a rigorous thinking to his financial research. Gregg's passion for finance resulted in the creation of a real-time quote system and his work has been featured nationally in publications, such as the Investment Guide magazine.
As an avid researcher, Gregg concentrates on leveraging what institutional and big money players are doing to move the market and create seasonal trend patterns. Using custom research tools, Gregg identifies stocks that are optimal for stock and options traders to exploit these trends and find the tailwinds that can propel stocks to levels that are hidden to the average trader.
The content on any of Market Tamer websites, products, or communication is for educational purposes only. Nothing in its products, services, or communications shall be construed as a solicitation and/or recommendation to buy or sell a security. Trading stocks, options, and other securities involve risk. The risk of loss in trading securities can be substantial. The risk involved with trading stocks, options and other securities are not suitable for all investors. Prior to buying or selling an option, an investor must evaluate his/her own personal financial situation and consider all relevant risk factors. See: Characteristics and Risks of Standardized Options (http://www.optionsclearing.com/publications/risks/riskstoc.pdf). The www.MarketTamer.com educational training program and software services are provided to improve financial understanding.
Related Posts
Also on Market Tamer…
Follow Us on Facebook