July historically is the best performing month of the third
quarter however, the mostly negative results in August and September tend to
make the comparison easy. Two “hot” Julys in 2009 and 2010 where DJIA and
S&P 500 both gained greater than 6% and strong performances in 2013 and
2018 have boosted July’s average gains since 1950 to 1.3% and 1.1%
respectively. Such strength inevitability stirs talk of a “summer rally”, but
beware the hype, as it has historically been the weakest rally of all seasons
(page 74, Stock Trader’s Almanac2021).
July begins NASDAQ’s worst four months and is the fifth
weakest performing NASDAQ month since 1971, posting a 0.6% average gain.
Dynamic trading often accompanies the first full month of summer as the
beginning of the second half of the year brings an inflow of new capital. This
creates a bullish beginning, a soft week after options expiration and some
strength towards the end.
Post-election year Julys rank at or near the top of all
post-election year months. DJIA, S&P 500, and NASDAQ are ranked #1. Russell
2000 ranks #2. Delving deeper into this data revealed that many of these past
“hot” Julys were preceded by a flat or down first half of the year so there is
no guarantee that this July will live up to its historical post-election year
record again this year.
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down of seasonal tendencies that occur throughout each month of the year in an
easy-to-read calendar graphic with important economic release dates
highlighted, Daily Market Probability Index bullish and bearish days, market
trends around options expiration and holidays. In addition, the Monthly
Vital Statistics Table combines stats for the Dow, S&P 500, NASDAQ,
Russell 1000 and Russell 2000 and puts them all in a single location available
at the click of a mouse.