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Two Popular Stock Market Cycles

 

We all know that the market runs in cycles. 

Two most popular cycles are as follows:

  1. The US Presidential Cycle (better known as the 4 year election cycle)
  2. Seasonal Cycle or a 1 Year Cycle

 

                                          The US Presidential Cycle


ACCORDING TO THE CYCLE: 

  • The best time they say to buy stocks is - a year before an election
  • Stock equity rises in the first year (also known as the President’s honeymoon year)
  • Market rallies and then fall in the fourth year of the presidential term,
  • The cycle repeats again with the next presidential election.

                                                Seasonal Cycle or a 1 year cycle

The usual belief of the seasonal cycle is that we often see a year-end rally which continues till January ( also known as the Santa Claus rally)

The  follows a correction till May

As they say- Sell in May and go away, come away in Saint Patricks day ( i.e. September) .

Then we witness the Summer Lull

October gives us the Fearful Autumn Storms. 

Before the investors get ready again for the Year-End |Rally

 

That completes the market cycle. 

Trade safe.

Stay safe

Sanchaita

 

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