Sell in May?

• Sy Harding passed away last week. He was one of the "Sell in May" guys who used the MACD to identify a time to sell stocks in the Spring and buy stocks in the Fall.  Sad to hear that he passed and my thoughts and prayers are with his family, friends, and all who followed him.  
• The market had an uneasy April. Will May be better? So far!  It is tempting to Sell in May.  The market has not had a decent pullback or correction in awhile. Yet, sometime moving sideways for a long and boring period of time eases things.  What to do... What to do...
• I am still long the market but may ease back a little.  Just having a hard time deciding because Sell in May hasn't worked recently.
• I didn't watch the fight. Big news is that the fight was transmitted live for free over the live streaming sites like Twitters Periscope. Will the fight organizers go after Twitter?  They say they may go after both the companies that allow the piracy and the Pirates themselves.  
• The Dodgers playing well. At home, anyway. 
• The Warriors also playing well. Anywhere there is a basketball court. 
• I binged watched Bloodline on Netflix. Liked it!
• Twitter earnings weren't such a shocker, but the way the earnings were released and the investor reaction was.  Facebook had only sold off a little after their earnings, so when the other big eyeball sites like Twitter, Yelp, and Linked In fell so hard, I know it caught me off guard.  
• Although honestly, I don't "get" Linked In.  It's the site I use the least, no matter who is endorsing me for a skill set or wants to connect. Gee, go see me on FB for cryin out loud. At least I post pics of my dog on FB!
• Of those I use Twitter the most.  Then FB. Then Yelp. And rarely look at Linked In. 

Seasonal Sell Signal? Thoughts

Checking out Sy Harding's blog to see if he issued a seasons in the sun sell signal yesterday, as the MACD for the DOW crossed down.  The SP500 was close, but held up.  This is all it says:

Wednesday, April 22, 2009. 9:15 a.m.

April 22nd, 2009 Subscribers: There is another new hotline update on your website from last evening, and there will be an in-depth ‘Markets Signals and Recommendations’ update on your website later today.

Usually the information leaks out, but haven't found anything yet via The Google. 

Another seasonal timer is Jeffery Hirsch, and I found this from a CNBC column:

The timing of this rally also does not bode well for what lies ahead, says Jeffery Hirsch, editor of the Stock Trader's Almanac, who notes the market's traditional bullish period runs from November-April.

"Some of the old seasonality may not be in effect; that in itself is a negative indication," says Hirsch. "We've stalled at that 8000-ish resistance level and we’ve got the bad season coming on."

Hirsch notes that the Dow has had only four up months in the 17 dating back to Nov 2007--right after the record highs of October--and that the market has posted gains on only two Mondays since early December, suggesting investors don't want to jump back in after the weekend when they are traditionally loathe to be long. 

That sort of bearishness does not mix well with seasonal performance, especially when investors remember the two previous major false bottoms of this bear market.

I haven't done any "seasonal" moves, yet.  One thought would be that since the market has moved up since Monday's fall, stay with it until we have another large distribution day and/or an IBD sell signal.  Or wait until after the beginning of the month strength (should it happen).  But so far the market has moved up since Monday's selling, so no reason to act too soon and try to anticipate a top.  Could just wait and see what happens what internals look like should we revisit the top and try to break through.

Then should one raise cash, the next question is what do to with it.  Interest rates are nil, and who wants to go in short-term treasuries when the government is spending trillions via deficit spending?  (Especially if one thinks the economy is recoverying and the Fed will be behind the curve in anticipating inflation).

Just a few thoughts. And some Lakers Girls

Saturday Night Randomosity

• In six weeks, the SP500 has advanced 28.5%.  Biggest six week advance since 1938.  If history is any indicator, Germany will soon invade Poland.  Stay tuned, and cancel those vacation plans for France.
• My thoughts are that this next week would be the logical point for the markets to take a break.  It's the week after options expiration and the week before the end of month 401(k) contributions.  Coincidentally, we could get an interesting sell signal if the MACD crosses down triggering the seasonal exit point for the folks who follow Sy Harding.
• Go Lakers!
• Ice is expanding in much of Antarctica, contrary to the widespread public belief that global warming is melting the continental ice cap.  You don't hear much of this in the media, as the government tries to push through expensive climate change legislation (to raise lots of money).
• The Israeli military is preparing itself to launch a massive aerial assault on Iran's nuclear facilities within days of being given the go-ahead by its new government, the Times of London reported.  Since we're hearing about it, is it just saber rattling and posturing?
• President Obama says he is going to cut wasteful programs.  Anyone taking bets on this?  Anyone keeping track?  I wish him luck, but call me very skeptical.  He has to get this by Harry and Nancy, and do you see them cutting programs?  Everyday we hear of new programs, so net-net I can't imagine there being fewer programs in the years ahead.
• A Florida woman stabbed her boyfriend in the chest with a steak knife over Pop Tarts, police said.  Many people take their pop tarts seriously.  I did a Twitter search for Pop Tarts, and look at all the chatter going on:



• A southwest Ohio teacher has resigned after acknowledging she accompanied four female students to a male strip club, a school spokesman said. Oh yes it's ladies night, and I'm feeling right.  Oh yes it's ladies night, oh what a night (oh, what a night).
• Dodgers continued on their win streak, besting Colorado yet again.  Loving the iPhone app MLB.com.
• Rumor is that Hulu is making an app for the iPhone.  That's NBC.  Now you will be able to watch Samantha Who whenever you want.  Er...

Seasons in the Sun Recap

Sy Harding's Seasons in the Sun (STS) recap:

In a nutshell. STS looks for daily MACD to give signals on or after the average best days to enter and leave the market using the seasonal strategy.

The average best day to exit the market is April 20
The average best day to enter the market is October 16

IF MACD is negative on April 20, then you exit the market that day. If MACD is positive, then you wait for it to turn negative to exit the market.

Likewise, if MACD is positive on October 16, then you enter the market on that day. If MACD is negative, then you wait for it to turn positive to enter the market.

Here's the chart...


The buy signal was here, around 950-ish on the SP500.

Seasonal Buy Signal

$$ For those following market seasonality, I believe we had a buy signal last week with the MACD crossover. Here's the chart from stockcharts:



From Sy Harding's website:

The idea is that if a rally is underway when the October 16 calendar date for seasonal entry arrives, as indicated by the MACD indicator, we will enter at that time. However, if the MACD indicator is on a sell signal when the October 16 calendar date arrives, indicating a market decline is underway, it would not make sense to enter before that decline ends, even though the best average calendar entry date has arrived. Instead, our Seasonal Timing Strategy simply waits to enter until MACD gives its next buy signal, indicating that the decline has ended.

The MACD crossed over last week. Rather dramatically.