Sell in May and Go Away?

[YOUNG_TRADER]

Well its coming up to that time of year again and with now just a little over 1 week to go I thought I'd ask the $64Billion dollar question, will the onset of May see the old adage of selling?

My answer No, if anything a correction will come in late May, ie the last few days,

Why?

Well because on Thursday the World had its excuse to correct, China fell nearly 5% on that day taking Hong Kong down about 2.5% and Japan about 1.5%+

I thought yep here we go correction time, base metals were sold off and everything looked set to begin, but the FTSE as usuall was waiting for the DJIA for direction,

Long story short the US Mkts hardly blinked and as a result niether did the FTSE, on Friday the Aussie Mkts were hardly affected and base metals strengthened, China too regained almost 4% on Friday and finally to finish off the week, the DJIA rallied too a new record high.

So ask yourself this, what exactly will the catalyst be to trigger a Sell in May situation?

Mkts rarely perform to expectations, so with everyone expecting a sell off in may, my bet is it won't come, instead as punters breathe a sigh of relief that the sell in May didn't come and begin to pile back into the mkt late May/Early June Whamoo we'll get a correction, the US will be the trigger

Thoughts?

 

[breakeven]

YT, re US being the trigger. The analysts in the US have been saying that the year prior to a presidential election is rarely bad in stock market terms. So they expect this year to be fine. The profit results out of the US have suprised on the up side.

 

[nizar]

Well its coming up to that time of year again and with now just a little over 1 week to go I thought I'd ask the $64Billion dollar question, will the onset of May see the old adage of selling?

My answer No, if anything a correction will come in late May, ie the last few days,

Why?

Well because on Thursday the World had its excuse to correct, China fell nearly 5% on that day taking Hong Kong down about 2.5% and Japan about 1.5%+

I thought yep here we go correction time, base metals were sold off and everything looked set to begin, but the FTSE as usuall was waiting for the DJIA for direction,

Long story short the US Mkts hardly blinked and as a result niether did the FTSE, on Friday the Aussie Mkts were hardly affected and base metals strengthened, China too regained almost 4% on Friday and finally to finish off the week, the DJIA rallied too a new record high.

So ask yourself this, what exactly will the catalyst be to trigger a Sell in May situation?

Mkts rarely perform to expectations, so with everyone expecting a sell off in may, my bet is it won't come, instead as punters breathe a sigh of relief that the sell in May didn't come and begin to pile back into the mkt late May/Early June Whamoo we'll get a correction, the US will be the trigger

Thoughts?

Brother I kid you not I was gonna write exactly the same thing and found myself nodding at every word you said!!

Too many people expect a correction now, I'm gonna wait until every1s bullish again and has 7000pts targets, then I start selling.

And its no point selling now just in case as several have done -- because, in my opinion -- the most vertical climbs come immediately before any crash/correction.

 

[constable]

i love lamp

 

[YOUNG_TRADER]

i love lamp

You too?

 

[bean]

The DOW approaching 13,000. The DOW may correct once its reach or it may be continuing in a blow of fashion out of the last 16 days it has been up 15 It had 8 up one down now 7 up.

Nasdaq is at 2525 round about 2550 was when it went into bubble territory on its way to 5000.
So the Nasdaq is fast approahcing its its previous bubblemania

 

[ta2693]

I think the crash could happen any time any where. It is so random. It may just because of butterfly effect. I do not know why May is so different.

 

[nizar]

Statistically September is a much more worse month than MAy.

 

[ta2693]

Lets take US market for example

9/17/2001 -4.92% First day of trading after 911
9/3/2002 -4.15% Market declined in Europe and Japan, weak Us and Eu manufacturing numbers, problem among japan bank
7/9/2002 -3.83% Continue concern about account profit
3/24/2003 -3.52% Fear the iraq war could be longer
8/5/2002 -3.43% Weaker than expected US employment report
7/10/2002 -3.40% Waning confident in market and company integrity
7/22/2002 -3.29% Bush affirm support of treasury secretary
9/27/2002 -3.23% Lack of consumer confidence, negative earning news
9/20/2001 -3.11% Political and economic uncertainty
9/19/2002 -3.01% Bad corporate news
8/1/2002 -2.99% Report shows slowed manufacturing growth
......
so random.

 

[Kimosabi]

I think what people need to take into consideration is that quite a bit of money is coming into the Aussie market from Overseas, also from Super, debt is cheap and easy to get, and that Reserve Banks around the world are printing more and more money at the moment, so why should it go down yet?

I think it's about time for irrational exuberance to kick in, because as we all know, it's different this time...

 

[pods]

If the market generally has a downturn in those months, why not just short?

 

[nizar]

Lets take US market for example

9/17/2001 -4.92% First day of trading after 911
9/3/2002 -4.15% Market declined in Europe and Japan, weak Us and Eu manufacturing numbers, problem among japan bank
7/9/2002 -3.83% Continue concern about account profit
3/24/2003 -3.52% Fear the iraq war could be longer
8/5/2002 -3.43% Weaker than expected US employment report
7/10/2002 -3.40% Waning confident in market and company integrity
7/22/2002 -3.29% Bush affirm support of treasury secretary
9/27/2002 -3.23% Lack of consumer confidence, negative earning news
9/20/2001 -3.11% Political and economic uncertainty
9/19/2002 -3.01% Bad corporate news
8/1/2002 -2.99% Report shows slowed manufacturing growth
......
so random.

5 out of 11 being September.

Also, how does PPT (plunge protection team) work. Do they only start buying after 5% down or what??
I wouldve thought 4.5% is pretty significant.

 

[chops_a_must]

How can you have a May sell off in April or June?

I vote, logical fallacy.

 

[Dukey]

Brother I kid you not I was gonna write exactly the same thing and found myself nodding at every word you said!!

Too many people expect a correction now, I'm gonna wait until every1s bullish again and has 7000pts targets, then I start selling.

And its no point selling now just in case as several have done -- because, in my opinion -- the most vertical climbs come immediately before any crash/correction.

And the most vertical falls come right after!!..... how do you pick it?? or do you just ride it out.

I voted "Late May correction" - With my well known charting expertise (cough :bonk: cough) I reckon we'll top around 6300 and then down she comes ... maybe just a few hundred points - lets say 357 points to be exact.
(from my patent pending random number generator).

 

[YOUNG_TRADER]

How can you have a May sell off in April or June?

I vote, logical fallacy.

Does that mean you love lamp?

 

[ROE]

Sell in May and Go Away
Nifty fifty
Dog of the Dow/ASX

Anything else ?

 

[Out Too Soon]

The "Sell in May" is self perpetuating. Everyone expects it will probably happen, therefore it will, whether there's a more concrete reason for it or not. You know it's true & so do I, that's why I have such a comparitavely small holding at present & looking to exit that so I'm ready for the bargains in the Great May Sale!!!!

PS: Do you like my logic or what???

 

[nizar]

The "Sell in May" is self perpetuating. Everyone expects it will probably happen, therefore it will, whether there's a more concrete reason for it or not. You know it's true & so do I, that's why I have such a comparitavely small holding at present & looking to exit that so I'm ready for the bargains in the Great May Sale!!!!

PS: Do you like my logic or what???

Yeh thats what i thought about last October.
Then we had this massive rally.
Lucky i reacted to what happened rather than try 2 predict the market.

 

[jammin]

Lucky i reacted to what happened rather than try 2 predict the market.

Wise words Nizar. Whilst the May and October downturns are there to see on the charts, the severity and date of commencement vary dramatically. So be watchful and react to what you see.
I wonder how much impact stocks going ex-dividend around these months have on the charts.

 

[bean]

Well I have been posting for the sell in May go away but I just realised I might be buying Gold as the markets falling