The week just concluded - at least as far as trading is concerned - and it was a good week.
As I sit and sip my (second) cup of coffee while my family sleeps, I thought I'd take a look at a few charts. While we look at charts every day, zooming out and looking at the weekly data is often very helpful. It helps to dampen down the noise of the daily charts so we can see a bigger picture.
The chart below is the weekly chart for the iShares Russell 3000 ETF (Ticker: IWV). In the bottom pane, I'm showing the number of advancing stocks (represented by the green bars) and the number of declining stocks (represented by the red bars). When looking at this data in this weekly format, we can easily see that the last four weeks have seen an expanding list of advancing stocks while (naturally) the inverse is true for declining stocks. While nothing in this business is guaranteed, this is indeed an encouraging trend to see.
The second chart, is a Seasonality chart. The bottom pane is how we typically view the Seasonality chart. It shows the average performance for the S&P 500 broken down by month. As we've discussed in several YouTube videos, October through January is typically the best four months of stock market's year. If you look closely, you can see the blue diamond which represents October 2024. So far, this October is right at the month's average performance.
However, the top pane of this seasonality chart shows the average month of October broken down by day. You may recall from last month's Monthly Market Monologue video that September is historically a tale of two halves. The first half of September is historically decent, while the second half of September is historically bad. That did not happen this year, both the first half and the second half of September were pretty strong. Like everything in technical analysis, we cannot draw any firm conclusion from the historical average month of October. But when we look at the data, it is certainly good to see that October - typically a good month in the stock market - has already gotten off to a strong start with expanding breadth and the back half of October is historically also strong.
Enjoy your weekend ... I think I'm gonna get another cup of coffee.
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