Sunday, July 31, 2011

Pre-Presidential Projection Update

Pre-presidential election years are usually bullish with a very tight standard deviation. Towards the end of every month I like to publish a seasonal projection of how the year is shaping up and here's my latest:



The projection represents the average performance of every 4th year for the last 5 election seasons starting from an anchor-date. In the above chart I show two of the same 4 year cycle projections but anchored the first day of the year (blue) and the most recent trading day (magenta) of the year. The Obama pre-presidential cycle is underperforming the average but we are on a course to end the year between 1380 and 1490, which just hurdles above 1 standard deviation below the Jan 1 projection for an 8% gain for the year (green.)



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