How to play the month of September

[FD1000]

By Tom Bowley | September 10,
(stockcharts.com/articles/chartwatchers/2021/09/what-you-need-to-know-about-se-737.html)

Momentum remains fairly strong and the trend is up, so why should we worry? Well, let's cast aside the historical consequences of September for a moment and simply focus on next week -- options expiration week.

Since 1950, the S&P 500 has produced annualized returns as follows throughout the calendar month (all calendar months, not just September):
26th through 6th: +21.77%
7th through 10th: -4.04%
11th through 18th: +13.29%
19th through 25th: -8.51%

But not every day or week in September has performed equally. In fact, since 1950, here's the annualized return in September, broken down by the first and second halves:
September 1-16: +9.98%
September 17-30: -22.49%

If we look at the current secular bull market (2013-2020), the annualized returns for these same two periods is as follows:
September 1-16: +12.54%
September 17-30: -15.34%

There are a few things that stand out to me. First, and perhaps surprisingly, technology (XLK) is the only sector that historically doesn't gain ground in the first half of September. The second is maybe even more surprising. When S&P 500 performance turns ugly in the 2nd half, the XLK is the BEST performing sector by a fairly wide margin.

[Chahta]

Simple. Sell everything on 9/16.

[xray]

Could be a very good recommendation if one is currently [and constantly] "underwater". If not, "Opportunity" always presents itself in a serious down market....

Live Long and Prosper....

[oldskeet]

Hi guys ... and, for me.

In a stock market pullback of 10% to 15% (perhaps more) I'd rather be thinking of what I'm buying more so than what I'd be selling to raise cash. Therefore, Old_Skeet normally rolls with a cash allocation of about 20% with half of that being marked as opportunity cash to engage special investment positions (spiff) when deamed appropriate.

Should the past five down days turn into another five down days then I'm thinking we are most likely headed for a selling stampede which normally last from 21 to 27 days accoring to Jeffrey Saut with some stampedes lasting 30 days or more.

My buy list is made out with cash ready to spend!

Old_Skeet

[Chahta]

Sept 11, 2021 13:58:55 GMT Chahta said:

Simple. Sell everything on 9/16.

I was kidding. I do not sell equities but rather rebalance and realize a CG once in a while. I have plenty of sale-able things to use for buying. There will be plenty of selling when RMDs kick in.

[Capital]

Sept 11, 2021 18:47:47 GMT Chahta said:

Sept 11, 2021 13:58:55 GMT Chahta said:

Simple. Sell everything on 9/16.

I was kidding. I do not sell equities but rather rebalance and realize a CG once in a while. I have plenty of sale-able things to use for buying. There will be plenty of selling when RMDs kick in.

I've got a boat load of dividends heading my way starting Monday and continuing throughout the month. I use those for rebalancing. Mutual Funds and ETFs are most of my holdings. The dividends come quarterly so I rebalance quarterly. Normally I don't completely get rebalanced with the dividends; but, it's easier to me.

[Fearchar]

For the S&P 500, expect support at 4432.1

Set your stop at 4359.0

[steelpony10]

Sept 11, 2021 13:36:24 GMT FD1000 said:

By Tom Bowley | September 10,
(stockcharts.com/articles/chartwatchers/2021/09/what-you-need-to-know-about-se-737.html)

Momentum remains fairly strong and the trend is up, so why should we worry? Well, let's cast aside the historical consequences of September for a moment and simply focus on next week -- options expiration week.

Since 1950, the S&P 500 has produced annualized returns as follows throughout the calendar month (all calendar months, not just September):
26th through 6th: +21.77%
7th through 10th: -4.04%
11th through 18th: +13.29%
19th through 25th: -8.51%

But not every day or week in September has performed equally. In fact, since 1950, here's the annualized return in September, broken down by the first and second halves:
September 1-16: +9.98%
September 17-30: -22.49%

If we look at the current secular bull market (2013-2020), the annualized returns for these same two periods is as follows:
September 1-16: +12.54%
September 17-30: -15.34%

There are a few things that stand out to me. First, and perhaps surprisingly, technology (XLK) is the only sector that historically doesn't gain ground in the first half of September. The second is maybe even more surprising. When S&P 500 performance turns ugly in the 2nd half, the XLK is the BEST performing sector by a fairly wide margin.

         You’re making my head spin Captain and I’m only in the stands watching. This traditionally is the month when this years pigs get slaughtered.

          The bulls see how the facts unfold while they watch and often step back in with the pros before the traditional “next market” begins. Of course the bears are perfectly allocated and diversified to cover all possible future scenarios so they have no need to screw things up by increasing an allocation 1% then losing sleep over it.

          

[oldskeet]

Hi guys, Please bear with me on my pondering and my thinking for the rest of September and October.

Old_Skeet's thinking is to stay "buckled up" as Third Quarter 2021 earning reporting season does not start until October 21, 2021. With this, I am of the thoughts that the next four to five weeks could provide for some good buying opportunities as stocks meet a good number of headwinds. However, I'm seeing forward earnings estimates for the S&P 500 Index in the $205 to $210 range for 2022. So, for me, I'll start some equity spiff buying on a 5% to 10% pullback; and, should we move into a correction (pullback of 10% to 20%) I'll continue my step buy process. The bigger the pullback becomes the larger the step buy becomes with the theory being that as stocks drop in price then there becomes less risk in owning them.

Anyway, at least, you now know my market read along with my playbook for September and October.

I sincerely wish all ... "Good Investing."

I am, Old_Skeet

[uncleharley]

I may be moving some of my trading account back to precious metals if the taper talk escalates in reaction to further inflation reports. Right now, I am waiting and watching.