Chart of the Week: Presidential Election Cycle Gains

The Presidential election cycle tends to see markets bottom in the 2nd year of a Presidency, and peak in the 4th. It held true in 2002, where the markets bottomed on October.

Presidential Election Cycle Gains
spx_presidential_cycle.bmp
Source: ChartoftheDay.com

The cycle predicts that the market will peak this year. Note that we are still below the average percentage gain since 1950. While this is not conclusive, it suggests there is still room left to run.

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