Stock Trader's Almanac 2025 E-Book

Jeffrey A. Hirsch

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Serie: Almanac Investor Series
• Sprache: Englisch
• Veröffentlichungsjahr: 2024

Seitenzahl: 408

Beschreibung

58th Annual Edition of the leading resource on US stock market trend, patterns, and cycles

Neatly organized in an accessible calendar format, Stock Trader's Almanac 2025 enables traders around the world to make sense of the complexities of the US stock market by recognizing historical cycles, trends, and patterns that are essential to making sound investment decisions. This 58th Annual Edition has been thoroughly revised for 2025 to help readers on monthly and daily basis, explaining a wealth of proven proprietary strategies including the “January Barometer,” the “Santa Claus Rally,” the “Best Six Months,” and the four-year “Presidential Election Cycle.”

Edited by veteran trader and market strategist Jeffrey Hirsch, this 2025 Almanac is a testament to the original iconic work founder Yale Hirsch created in the first 1968 edition and the over five decades of behavioral finance thought leadership it has provided since. The Almanac remains the most valuable trader's desk reference on Wall Street and this year's edition is packed with seasonal and historic investing insights for the year ahead including:

• How our Presidential Elections affect the economy and the stock market—just as the moon affects the tides
• Post-Election Years Best Year of the 4-Year Cycle Since 1985
• How the passage of the Twentieth Amendment to the Constitution fathered the January Barometer
• Why there is a significant market bias at certain times of the day, week, month and year
• Market behavior three days before and after the holidays
• Updates investment knowledge and informs you of new techniques and tools.
• Is a monthly reminder and refresher course.
• Alerts you to both seasonal opportunities and dangers.
• Furnishes a historical viewpoint by providing pertinent statistics on past market performance.
• Supplies forms necessary for portfolio planning, record keeping and tax preparation

On the desks of Top Money Managers since 1968, Stock Trader's Almanac 2025 is an essential resource for both retail and institutional investment professionals seeking to understand recurring patterns in the US stock market and consistently maximize profit potential.

Leseprobe

Table of Contents

COVER

TABLE OF CONTENTS

TITLE PAGE

COPYRIGHT

INTRODUCTION TO THE FIFTY-EIGHTH EDITION

2025 OUTLOOK

2025 STRATEGY CALENDAR

JANUARY ALMANAC

JANUARY'S FIRST FIVE DAYS: AN EARLY WARNING SYSTEM

THE INCREDIBLE JANUARY BAROMETER (DEVISED 1972): ONLY 12 SIGNIFICANT ERRORS IN 74 YEARS

BULLS WIN WHEN MARKET HITS THE JANUARY TRIFECTA

FEBRUARY ALMANAC

DOWN JANUARYS: A REMARKABLE RECORD

MARKET CHARTS OF POST-PRESIDENTIAL ELECTION YEARS

POST-ELECTION YEAR PERFORMANCE BY PARTY

MARCH ALMANAC

POST-ELECTION YEARS: PAYING THE PIPER

MARKET FARES BETTER UNDER DEMOCRATS; DOLLAR HOLDS UP UNDER REPUBLICANS

THE DECEMBER LOW INDICATOR: A USEFUL PROGNOSTICATING TOOL

HOW TO TRADE BEST MONTHS SWITCHING STRATEGIES

APRIL ALMANAC

DOW JONES INDUSTRIALS ONE-YEAR SEASONAL PATTERN CHARTS SINCE 1901

S&P 500 ONE-YEAR SEASONAL PATTERN CHARTS SINCE 1930

NASDAQ, RUSSELL 1000 & 2000 ONE-YEAR SEASONAL PATTERN CHARTS SINCE 1971

MAY ALMANAC

SUMMER MARKET VOLUME DOLDRUMS DRIVE WORST SIX MONTHS

TOP-PERFORMING MONTHS: STANDARD & POOR'S 500 AND DOW JONES INDUSTRIALS

“BEST SIX MONTHS”: STILL AN EYE-POPPING STRATEGY

MACD-TIMING TRIPLES “BEST SIX MONTHS” RESULTS

JUNE ALMANAC

TOP-PERFORMING NASDAQ MONTHS

GET MORE OUT OF NASDAQ'S “BEST EIGHT MONTHS” WITH MACD TIMING

TRIPLE RETURNS, FEWER TRADES: BEST 6 + 4–YEAR CYCLE

JULY ALMANAC

FIRST MONTH OF QUARTERS IS THE MOST BULLISH

2023 DAILY DOW POINT CHANGES (DOW JONES INDUSTRIAL AVERAGE)

DON'T SELL STOCKS ON MONDAY OR FRIDAY

AUGUST ALMANAC

A RALLY FOR ALL SEASONS

TAKE ADVANTAGE OF DOWN FRIDAY/ DOWN MONDAY WARNING

REPUBLICAN CONGRESS & DEMOCRATIC PRESIDENT IS BEST FOR THE MARKET

FOURTH QUARTER MARKET MAGIC

SEPTEMBER ALMANAC

MARKET GAINS MORE ON SUPER-8 DAYS EACH MONTH THAN ON ALL 13 REMAINING DAYS COMBINED

A CORRECTION FOR ALL SEASONS

FIRST-TRADING-DAY-OF-THE-MONTH PHENOMENON

OCTOBER ALMANAC

SECTOR SEASONALITY: SELECTED PERCENTAGE PLAYS

SECTOR INDEX SEASONALITY STRATEGY CALENDAR

NOVEMBER ALMANAC

MARKET BEHAVIOR THREE DAYS BEFORE AND THREE DAYS AFTER HOLIDAYS

TRADERS FEAST ON SMALL STOCKS THANKSGIVING THROUGH SANTA CLAUS RALLY

TRADING THE THANKSGIVING MARKET

AURA OF THE QUAD WITCH—4TH QUARTER MOST BULLISH: DOWN WEEKS TRIGGER MORE WEAKNESS WEEK AFTER

DECEMBER ALMANAC

MOST OF THE SO-CALLED JANUARY EFFECT TAKES PLACE IN THE LAST HALF OF DECEMBER

JANUARY EFFECT NOW STARTS IN MID-DECEMBER

WALL STREET'S ONLY “FREE LUNCH” SERVED BEFORE CHRISTMAS

IF SANTA CLAUS SHOULD FAIL TO CALL, BEARS MAY COME TO BROAD AND WALL

2026 STRATEGY CALENDAR

DIRECTORY OF TRADING PATTERNS AND DATABANK

DOW JONES INDUSTRIALS MARKET PROBABILITY CALENDAR 2025

RECENT

DOW JONES INDUSTRIALS MARKET PROBABILITY CALENDAR 2025

S&P 500 MARKET PROBABILITY CALENDAR 2025

RECENT

S&P 500 MARKET PROBABILITY CALENDAR 2025

NASDAQ COMPOSITE MARKET PROBABILITY CALENDAR 2025

RECENT

NASDAQ COMPOSITE MARKET PROBABILITY CALENDAR 2025

RUSSELL 1000 INDEX MARKET PROBABILITY CALENDAR 2025

RUSSELL 2000 INDEX MARKET PROBABILITY CALENDAR 2025

DECENNIAL CYCLE: A MARKET PHENOMENON

PRESIDENTIAL ELECTION/STOCK MARKET CYCLE: THE 191-YEAR SAGA CONTINUES

DOW JONES INDUSTRIALS BULL AND BEAR MARKETS SINCE 1900

STANDARD & POOR'S 500 BULL AND BEAR MARKETS SINCE 1929 NASDAQ COMPOSITE SINCE 1971

JANUARY DAILY POINT CHANGES DOW JONES INDUSTRIALS

FEBRUARY DAILY POINT CHANGES DOW JONES INDUSTRIALS

MARCH DAILY POINT CHANGES DOW JONES INDUSTRIALS

APRIL DAILY POINT CHANGES DOW JONES INDUSTRIALS

MAY DAILY POINT CHANGES DOW JONES INDUSTRIALS

JUNE DAILY POINT CHANGES DOW JONES INDUSTRIALS

JULY DAILY POINT CHANGES DOW JONES INDUSTRIALS

AUGUST DAILY POINT CHANGES DOW JONES INDUSTRIALS

SEPTEMBER DAILY POINT CHANGES DOW JONES INDUSTRIALS

OCTOBER DAILY POINT CHANGES DOW JONES INDUSTRIALS

NOVEMBER DAILY POINT CHANGES DOW JONES INDUSTRIALS

DECEMBER DAILY POINT CHANGES DOW JONES INDUSTRIALS

A TYPICAL DAY IN THE MARKET

THROUGH THE WEEK ON A HALF-HOURLY BASIS

TUESDAY & FRIDAY MOST PROFITABLE DAYS OF WEEK

NASDAQ STRONGEST LAST 3 DAYS OF WEEK

S&P DAILY PERFORMANCE EACH YEAR SINCE 1952

NASDAQ DAILY PERFORMANCE EACH YEAR SINCE 1971

MONTHLY CASH INFLOWS INTO S&P STOCKS

MONTHLY CASH INFLOWS INTO NASDAQ STOCKS

NOVEMBER, DECEMBER, AND JANUARY: YEAR'S BEST THREE-MONTH SPAN

NOVEMBER THROUGH JUNE: NASDAQ'S EIGHT-MONTH RUN

DOW JONES INDUSTRIALS ANNUAL HIGHS, LOWS, & CLOSES SINCE 1901

S&P 500 ANNUAL HIGHS, LOWS, & CLOSES SINCE 1930

NASDAQ ANNUAL HIGHS, LOWS, & CLOSES SINCE 1971

RUSSELL 1000 ANNUAL HIGHS, LOWS, & CLOSES SINCE 1979

RUSSELL 2000 ANNUAL HIGHS, LOWS, & CLOSES SINCE 1979

DOW JONES INDUSTRIALS MONTHLY PERCENT CHANGES SINCE 1950

DOW JONES INDUSTRIALS MONTHLY POINT CHANGES SINCE 1950

DOW JONES INDUSTRIALS MONTHLY CLOSING PRICES SINCE 1950

STANDARD & POOR'S 500 MONTHLY PERCENT CHANGES SINCE 1950

STANDARD & POOR'S 500 MONTHLY CLOSING PRICES SINCE 1950

NASDAQ COMPOSITE MONTHLY PERCENT CHANGES SINCE 1971

NASDAQ COMPOSITE MONTHLY CLOSING PRICES SINCE 1971

RUSSELL 1000 INDEX MONTHLY PERCENT CHANGES SINCE 1979

RUSSELL 1000 INDEX MONTHLY CLOSING PRICES SINCE 1979

RUSSELL 2000 INDEX MONTHLY PERCENT CHANGES SINCE 1979

RUSSELL 2000 INDEX MONTHLY CLOSING PRICES SINCE 1979

10

BEST

DAYS BY PERCENT AND POINT

10

WORST

DAYS BY PERCENT AND POINT

10

BEST

WEEKS BY PERCENT AND POINT

10

WORST

WEEKS BY PERCENT AND POINT

10

BEST

MONTHS BY PERCENT AND POINT

10

WORST

MONTHS BY PERCENT AND POINT

10

BEST

QUARTERS BY PERCENT AND POINT

10

WORST

QUARTERS BY PERCENT AND POINT

10

BEST

YEARS BY PERCENT AND POINT

10

WORST

YEARS BY PERCENT AND POINT

STRATEGY PLANNING AND RECORD SECTION

PORTFOLIO AT START OF 2025

ADDITIONAL PURCHASES

SHORT-TERM TRANSACTIONS

LONG-TERM TRANSACTIONS

INTEREST/DIVIDENDS RECEIVED DURING 2025

BROKERAGE ACCOUNT DATA 2025

WEEKLY PORTFOLIO PRICE RECORD 2025 (FIRST HALF)

WEEKLY PORTFOLIO PRICE RECORD 2025 (SECOND HALF)

WEEKLY INDICATOR DATA 2025 (FIRST HALF)

WEEKLY INDICATOR DATA 2025 (SECOND HALF)

MONTHLY INDICATOR DATA 2025

PORTFOLIO AT END OF 2025

IF YOU DON'T PROFIT FROM YOUR INVESTMENT MISTAKES, SOMEONE ELSE WILL

PERFORMANCE RECORD OF RECOMMENDATIONS

INDIVIDUAL RETIREMENT ACCOUNTS: MOST AWESOME INVESTMENT INCENTIVE EVER DEVISED

G. M. LOEB'S “BATTLE PLAN” FOR INVESTMENT SURVIVAL

G. M. LOEB'S INVESTMENT SURVIVAL CHECKLIST

NOTES

END USER LICENSE AGREEMENT

Guide

Cover

Title Page

Copyright

Introduction to the Fifty-Eighth Edition

Table of Contents

Begin Reading

End User License Agreement

Pages

1

2

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

29

30

31

32

33

34

35

36

37

38

39

40

41

42

43

44

45

46

47

48

49

50

51

52

53

54

55

56

57

58

59

60

61

62

63

64

65

66

67

68

69

70

71

72

73

74

75

76

77

78

79

80

81

82

83

84

85

86

87

88

89

90

91

92

93

94

95

96

97

98

99

100

101

102

103

104

105

106

107

108

109

110

111

112

113

114

115

116

117

118

119

120

121

122

123

124

125

126

127

128

129

130

131

132

133

134

135

136

137

138

139

140

141

142

143

144

145

146

147

148

149

150

151

152

153

154

155

156

157

158

159

160

161

162

163

164

165

166

167

168

169

170

171

172

173

174

175

176

177

178

179

180

181

182

183

184

185

186

187

188

189

190

191

192

193

194

195

196

197

198

199

200

201

202

203

204

205

STOCK TRADER’S ALMANAC 2025

Jeffrey A. Hirsch & Christopher Mistal

www.stocktradersalmanac.com

Copyright © 2025 by John Wiley & Sons, Inc. All rights reserved, including rights for text and data mining and training of artificial intelligence technologies or similar technologies.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey.

Published simultaneously in Canada.

Editor-in-Chief

Jeffrey A. Hirsch

Director of Research

Christopher Mistal

Graphic Design

Darlene Dion Design

Publisher 1966–2000 & Editor 1966–2003

Yale Hirsch (1923–2021)

No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, [phone], fax [phone], or on the web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, [phone], fax [phone], or online at http://www.wiley.com/go/permission.

Trademarks: Wiley and the Wiley logo are trademarks or registered trademarks of John Wiley & Sons, Inc. and/or its affiliates in the United States and other countries and may not be used without written permission. All other trademarks are the property of their respective owners. John Wiley & Sons, Inc. is not associated with any product or vendor mentioned in this book.

Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. Further, readers should be aware that websites listed in this work may have changed or disappeared between when this work was written and when it is read. Neither the publisher nor authors shall be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.

For general information on our other products and services or for technical support, please contact our Customer Care Department within the United States at [phone], outside the United States at [phone] or fax [phone].

Wiley also publishes its books in a variety of electronic formats. Some content that appears in print may not be available in electronic formats. For more information about Wiley products, visit our web site at www.wiley.com.

ISBN: 9781394281244 (paper)ISBN: 9781394281251 (ePDF)ISBN: 9781394281268 (ePub)

INTRODUCTION TO THE FIFTY-EIGHTH EDITION

We are honored to present the 58th annual edition of the Stock Trader's Almanac. The Almanac provides you with the necessary tools and data to invest and trade successfully in the twenty-first century.

J.P. Morgan's classic retort “Stocks will fluctuate” is often quoted with a wink-of-the-eye implication that the only prediction one can make about the stock market is that it will go up, down, or sideways. Many investors and traders agree that no one ever really knows which way the market will move. Nothing could be further from the truth.

We discovered many years ago that while stocks do indeed fluctuate, they do so in well-defined, often predictable patterns. These patterns recur too frequently to be the result of chance or coincidence. How else do we explain that since 1950 the Dow has gained 31012.60 points during November through April compared to just 6588.99 May through October? (See page 54.)

The Almanac is a practical investment tool. It alerts you to those little-known market patterns and tendencies on which shrewd professionals enhance profit potential. You will be able to forecast market trends with accuracy and confidence when you use the Almanac to help you understand:

How our presidential elections affect the economy and the stock market—just as the moon affects the tides. Many investors have made fortunes following the political cycle. You can be sure that money managers who control billions of dollars are also political cycle watchers. Astute people do not ignore a pattern that has been working effectively throughout most of our economic history.

How the passage of the Twentieth Amendment to the Constitution fathered the January Barometer. This barometer has an outstanding record for predicting the general course of the stock market each year with only 12 major errors since 1950 for an 83.8% accuracy ratio. (See

page 18

.)

Why there is a significant market bias at certain times of the day, week, month and year.

Even if you are an investor who pays scant attention to cycles, indicators, and patterns, your investment survival could hinge on your interpretation of one of the recurring patterns found within these pages. One of the most intriguing and important patterns is the symbiotic relationship between Washington and Wall Street. Aside from the potential profitability in seasonal patterns, there's the pure joy of seeing the market very often do just what you expected.

The Stock Trader's Almanac is also an organizer. Its wealth of information is presented on a calendar basis. The Almanac puts investing in a business framework and makes investing easier because it:

Updates investment knowledge and informs you of new techniques and tools.

Is a monthly reminder and refresher course.

Alerts you to both seasonal opportunities and dangers.

Furnishes a historical viewpoint by providing pertinent statistics on past market performance.

Supplies forms necessary for portfolio planning, record keeping, and tax preparation.

The WITCH icon signifies THIRD FRIDAY OF THE MONTH on calendar pages and alerts you to extraordinary volatility due to expiration of monthly equity options, index options, index futures contracts as well as single stock and ETF futures. “Quadruple-Witching” days appear during March, June, September, and December (see page 108).

The BULL icon on calendar pages signifies favorable trading days based on the S&P 500 rising 60% or more of the time on a particular trading day during the 21-year period January 2003 to December 2023.

A BEAR icon on calendar pages signifies unfavorable trading days based on the S&P falling 60% or more of the time for the same 21-year period.

Clusters of two or more BULLs or BEARs can be especially helpful in identifying periods of strength or weakness throughout the year. Clusters can also be three out of four days or three out of five days. An example of three BULLs in four days can be observed on page 41 during the first week of April.

On pages 123–130 you will find complete Market Probability Calendars both long term and the recent 21-year period for the Dow, S&P and NASDAQ, as well as for the Russell 1000 and Russell 2000 indices. To give you even greater perspective we have listed on the weekly planner pages next to the date every day that the market is open the market probability numbers for the same 21-year period for the Dow (D), S&P 500 (S) and NASDAQ (N). You will see a “D,” “S” and “N” followed by a number signifying the actual market probability number for that trading day based on the recent 21-year period.

Other seasonalities near the ends, beginnings, and middles of months; options expirations, around holidays and other times are noted for Almanac investors' convenience on the weekly planner pages. All other important economic releases are provided in the Strategy Calendar every month in our newsletter, Almanac Investor, available at our website www.stocktradersalmanac.com. Please see the insert for a special offer for new subscribers.

One-year seasonal pattern charts for Dow, S&P 500, NASDAQ, Russell 1000, and Russell 2000 appear on pages 42, 44, and 46. There are three charts each for Dow and S&P 500 spanning our entire database starting in 1901 and one each for the younger indices. As 2025 is a post-presidential election year, each chart contains typical post-election year performance compared to all years.

The Russell 2000 is an excellent proxy for small- and mid-caps and the Russell 1000 provides a broader view of large caps. Annual highs and lows for all five indices covered in the Almanac appear on pages 151–155. Top 10 Best & Worst days, weeks, months, quarters and years for all five indices are listed on pages 174–183.

We have converted many of the paper forms in our Record Keeping section into spreadsheets for our own internal use. As a service to our faithful readers, we are making these forms available at our website www.stocktradersalmanac.com. Look for a link titled “Forms” at the bottom of the home page.

Post-presidential election years have historically been the worst year of the four-year cycle going back to the beginning of our database in 1833, the start of Andrew Jackson's second term as president, averaging a 3.3% gain on the Dow Jones Industrial Average (DJIA) over the past 48 cycles since 1833. But post- election year performance has improved since WWII and dramatically so in the last 10 cycles.

Since 1985 DJIA averages a gain of 17.2% in post-election years with eight up years and two down. This is the best average gain of the four-year cycle over this period, topping the pre-election year's 15.2% average, but the pre-election year boasts nine wins and only one loss. The full four-year cycle history appears on page 132. Our 4-Year Cycle chart in our 2025 Outlook on page 10 also illustrates the more recent outperformance of the post-election year.

You can find all the market charts of post-election years from 1941 to 2021 on page 26. We breakdown “Post-Election Year Performance by Party” on page 28 which shows the market performs better under Democrats in post-election years. “Post-Election Years: Paying the Piper” on page 32 provide a concise rundown of market action and market moving events for each year since 1913. How the “Market Fares Better Under Democrats” while the “Dollar Holds Up Better Under Republicans” is detailed on page 34. We discuss market behavior under different political alignments on page 80 where we observe how a “Republican Congress & Democratic President Is Best for the Market.”

We have updated two brand new pages we featured last edition. “Bulls Win When Market Hits the January Trifecta” on page 20 shows a new indicator we built in 2013 that combines our Santa Claus Rally (page 118) and January Barometer (page 18) with the First Five Days (page 16), creating a more powerful indicator. On page 104 is a new trading strategy, “Traders Feast on Small Stocks Thanksgiving through Santa Claus Rally.”

“How To Trade Best Months Switching Strategies” appears on page 38. How “Summer Market Volume Doldrums Drives Worst Six Months” is updated on page 50. Revised sector seasonalities including several consistent shorting opportunities, appear on pages 94–98.

Our 2025 Outlook on pages 10–11 anticipates further upside in 2025 though more muted than the outsized gains we have enjoyed in 2023 and 2024 so far at this writing. The bull market is likely to continue well into 2025 with market performance in line with more recent post-election year returns.

We are constantly searching for new insights and nuances about the stock market and welcome any suggestions from our readers.

Wishing you health, happiness, and success in 2025!

2025 OUTLOOK

2024 is a unique year. We have two presidential candidates both running for second terms. For only the second time in our history we have a former president who lost his bid for reelection to a second term running against the sitting president who beat him. This has reduced the uncertainty factor across the board for election year 2024, likely a substantial contributing factor to the market's outsized gains so far this year.

For the past three and half years the power of the 4-Year Presidential Election Cycle has held sway over the market. Admittedly, it is a bit uncanny how the market has tracked this historical pattern so closely since 2021 in the graph at the bottom of this page. The 4-Year Cycle along with our seasonal work is one of the cornerstones of our market analysis. It has enabled us to help Almanac readers and our Almanac Investor Newsletter members navigate the market and adjust their investment portfolios prudently and profitably, making more timely and effective trades.

Over the past four years our outlooks here in this space and our annual newsletter forecasts have been on point. We were unabashedly bullish for 2021, anticipated the 2022 midterm year bear market and called the textbook October 2022 midterm bottom, expected a new bull market to emerge in 2023 with above average pre-election year gains and 2024's bullish outlook is right on track.

We still anticipate full-year 2024 gains in line with our annual forecast published in our Almanac Investor Newsletter in late December 2023 in the January 2024 issue. Since the market has already achieved our base-case projection for 8-15% gains, our best-case scenario of 15-25% gains for 2024 is now in play. Although we expect the market to bounce around and gain little ground over the next couple of months while it navigates the election campaign, inflation and economic readings, interest rates, and the Fed's next move and machinations.

At this writing, the market and economy appear to be nailing the elusive and vaunted soft landing. As we asserted here last edition, we never subscribed to the inverted yield curve recession indicator business and still believe that the two consecutive negative quarters of GDP in 2022 Q1 and Q2 were a recession despite what the official NBER declarations say. Recent inflation readings have been tamer and appear to be trending lower again after stalling for several months. Economic growth has moderated this year after some robust GDP reports in 2023. The labor market remains tight with plenty of jobs available, solid hiring and wage growth and a relatively low unemployment rate.

This takes the pressure off the Fed to be in a rush to lower interest rates. Unless some economic or market crisis arises, we expect the Fed to cut rates at least once this year by 25 basis points, maybe twice. And while many expect that first cut in September we would not be surprised if they waited until after the election.

We might be tempted by the post-election year's notorious history as the worst year of the four-year cycle going back to the start of our database in 1833, the fifth year of Andrew Jackson's presidency, to lean bearish for 2025. The full four-cycle “191-Year Saga” on page 132 shows that post-election years average a paltry 3.3% return over these past 48 election cycles and that many wars and bear markets have started in a post-election year.

But post-election years have improved since WWII and since 1985 DJIA averages a gain of 17.2% in post-election years with eight up years and two down. This is the best average gain of the four-year cycle over this period, besting the pre-election year's 15.2% average, though the pre-election year has nine wins and only one loss. The one-year seasonal chart here at the bottom of page 11 that shows the S&P 500's performance during post-election years since 1949 paints a rather bullish picture for 2025. At this juncture we expect the market to be up 8-12% for the year with pullbacks in Q1 and Q3.

Politics and election cycles aside, the Super Boom we forecasted in May 2010 for Dow 38820 by 2025 is in high gear. DJIA hit 38820 this year and continues to hover around this level. Our 2010 call for a 500% move by 2025 has been completed, but the Super Boom pattern suggests there is still more upside yet to come. The current secular bull market continues with AI most likely being the next paradigm-shifting, culturally-enabling technology that propels the economy and market to new highs.

By our current estimation, we surmise that AI technology is somewhere in the area of the early Windows years from 1992–1995 and that this secular bull and Super Boom has many years to run. Wall Street's CEO Jamie Dimon himself said the other day that AI's impact could be as “transformational as some of the major technological inventions of the past several hundred years: Think the printing press, the steam engine, electricity, computing, and the Internet.”

Based upon the Super Boom pattern, completed three times in the 20th century, the next target for the Dow is 62430. How long it will take to reach this level will likely depend on when the current inflationary period cools to be in line with recent historic norms of around 2%. However, based upon the 10% per year average gain since 2009, DJIA could reach this lofty level by 2030.

Jeffrey A. Hirsch, June 13, 2024

Market closed on shaded weekdays; closes early when half-shaded.