Chart of the Week: Sell in May

Here is the classic version of the Sell in May chart:


Source: Chart of the Day 


In 2004, we  noted you could Sell in May (but don’t go away) — part 2 is here — as a tradable bottom was forming; Markets bottomed for the pre-election rally in August.

In 2005, we repeated the same view. The market struggled upwards after the May lows, and made some progress (not a whole lot) until Katrina.

Selling in May this year turned out to be a
good strategy.

The bounce that started Wednesday can run for a coupla
weeks to a month or so, but should not be mistaken for anything but a
bounce. This ultimately implies a late Q3/early Q4 low


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