Market Direction and Stock Trends

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Almanac Trader: Last five trading days of Election Year October’s modestly bullish

* October 25, 2016



Last week we looked at the markets weekly performance before, during and after Election Day. Two weeks before the election has historically been the worst performing week. This year, that week actually lines up rather closely with the last five trading days of October. The last five trading days are modestly bullish, up 56.3% of the time since 1952 with an average gain of 1.1%. The average gain is heavily influenced by a 10.5% advance in 2008. Excluding 2008, the average gain is just 0.4%. This is better than the S&P 500’s weekly performance two weeks before the election.

So which is correct? Technically both are correct. The weekly performance results are weekly performance before, during and after Election Day while the last five days of October are the last five days of October. Because weekly performance is relative only to Election Day it does not consider end-of-month market tendencies which are more likely to repeat.

http://jeffhirsch.tumblr.com/post/152264929208/last-five-trading-days-of-election-year-octobers

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