🍂Fall – Fell – Fallen. S&P500 Technical Perspectives over Q3'23
The US government is well on its way to going into lockdown and shutting down the economy as policymakers are deadlocked over the national budget for the next fiscal year.
While leading stock market strategists are not yet terribly concerned about such perspectives, and entertain hopes that investors have a high probability of "getting away with it" with strong performance, in reality the facts tell a different story.
S&P500
SPX
is suffering losses, and has already lost about half of its annual growth since the beginning of 2023, and the Nasdaq-100 index
NDX
reduced 2023 growth approximately by 30 percent.
To avoid a shutdown, Congress needs to pass all 12 spending bills for the next fiscal year by Sept. 30, something it has historically done rather poorly.
This could create problems for the market, which could immediately, that is, on the same day, be seriously affected by a US Government shutdown, considering SPX seasonality where September is one of the worst calendar month for investments into S&P500.
S&P500 Seasonality Chart
Meanwhile historical back test analysis says, in the past 20 government shutdowns, the S&P 500 stayed relatively flat, with the benchmark index losing an average 0.4% the week before a shutdown and gaining .1% by the end of a shutdown, according to a Reuters analysis of CFRA Research data.
And in some cases, stocks actually ended the shutdown period higher, with the market gaining a net 10% following the 2018-19 shutdown, according to Renaissance Macro.
Shutdowns lasting five days or more have also been known to see a quick market rebound, according to a 2021 Dow Jones analysis. On average, the S&P 500 had already moved into positive territory within one month of the shutdown. Shutdowns themselves are also relatively short. The last government shutdown, which was the longest-ever, lasted for 35 days.
Anyway everything could happened. To stay away, or look beyond the market's twists and turns in the weeks before, during, and immediately following a potential shutdown - this is could be very, very individual investment decision.
Technical pictures illustrates that weekly SMA(52) - 12 months simple moving average near 4150/4200 pp in
SPX
or Dec'23 Futures
ESZ2023
(depends what are you looking for) could be quite strong support in any cases.
While leading stock market strategists are not yet terribly concerned about such perspectives, and entertain hopes that investors have a high probability of "getting away with it" with strong performance, in reality the facts tell a different story.
S&P500
SPX
is suffering losses, and has already lost about half of its annual growth since the beginning of 2023, and the Nasdaq-100 index
NDX
reduced 2023 growth approximately by 30 percent. To avoid a shutdown, Congress needs to pass all 12 spending bills for the next fiscal year by Sept. 30, something it has historically done rather poorly.
This could create problems for the market, which could immediately, that is, on the same day, be seriously affected by a US Government shutdown, considering SPX seasonality where September is one of the worst calendar month for investments into S&P500.
S&P500 Seasonality Chart
Meanwhile historical back test analysis says, in the past 20 government shutdowns, the S&P 500 stayed relatively flat, with the benchmark index losing an average 0.4% the week before a shutdown and gaining .1% by the end of a shutdown, according to a Reuters analysis of CFRA Research data.
And in some cases, stocks actually ended the shutdown period higher, with the market gaining a net 10% following the 2018-19 shutdown, according to Renaissance Macro.
Shutdowns lasting five days or more have also been known to see a quick market rebound, according to a 2021 Dow Jones analysis. On average, the S&P 500 had already moved into positive territory within one month of the shutdown. Shutdowns themselves are also relatively short. The last government shutdown, which was the longest-ever, lasted for 35 days.
Anyway everything could happened. To stay away, or look beyond the market's twists and turns in the weeks before, during, and immediately following a potential shutdown - this is could be very, very individual investment decision.
Technical pictures illustrates that weekly SMA(52) - 12 months simple moving average near 4150/4200 pp in
SPX
or Dec'23 Futures
ESZ2023
(depends what are you looking for) could be quite strong support in any cases.
Trade active:
Sept 27, 2023
👍 More Down Has to Come
👍 More Down Has to Come
Trade active:
Oct 3, 2023
Target is almost there
Target is almost there
Trade active:
Oct 19, 2023
What's a SHILL MARKET!
What's a SHILL MARKET!
Trade active:
Oct 20, 2023
Oh, you said, "No, no, no"
I said, "No, no, no, no"
You say, "Take me home"
I say, "Dom Perignon"
You said, "No, no, no"
I said, "No, no, no, no"
NO, NO, NO, NO 😂😂😂
Oh, you said, "No, no, no"
I said, "No, no, no, no"
You say, "Take me home"
I say, "Dom Perignon"
You said, "No, no, no"
I said, "No, no, no, no"
NO, NO, NO, NO 😂😂😂
Trade active:
Oct 26, 2023
Kinda puke puke
Kinda puke puke
Still watching at 4,600 as a key resistance.