Seasonality Head Scratchers:

Looking at the chart below of the Nasdaq it has been well documented that September is the worst month for the tech benchmark CLOSING higher just once in the last 4 years with an average loss of 2.7%. Other things that come to mind are how the Santa Claus rally seems to be coming earlier every year, as strategies become mainstream they lose their edge. November has finished the month a perfect 4 of the last 4 years higher than when it started with an average gain of better than 4% (December is basically UNCH). The “sell in May and go away” adage seems stale as the best consecutive 3-month period is June-August. Getting through September should be volatile and perhaps if one can be nimble and take advantage of PRICE dislocations one can position themselves well as markets tend to look ahead. As a possible hedge or if one takes a bearish stance on technology keep an eye on the PSQ as it battles with its own 50-day SMA here after a quick 11% advance off the recent lows.

This article requires a Chartsmarter membership. Please click here to join.