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MRCI's Scenario Study

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MRCI's ScenarioSM Study
ScenarioSM Study for S & P 500 Stock Index as of Jan 01, 2008
Condition 1: Higher Monthly Close.
Action ---> Buy that month's close with objective of exceeding month's high within 2 months.
Tested Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov
Tested Years 45 45 45 45 45 45 45 45 45 45 45
Closed Higher 29 23 30 31 25 25 19 26 20 28 29
Exceeded High 27 19 25 27 20 20 18 21 18 25 22
Scenario Percentage 93% 83% 83% 87% 80% 80% 95% 81% 90% 89% 76%
Avg Max Increase 5.12% 5.35% 5.92% 4.43% 4.93% 4.71% 4.38% 5.08% 6.54% 5.69% 3.44%
Max Increase 13.54% 11.08% 13.82% 12.57% 12.90% 11.86% 8.63% 18.33% 20.72% 13.32% 6.99%
Avg Days To Max Increase 17 18 17 17 19 18 19 14 20 17 15
Avg Max Decline -1.29% -0.57% -1.32% -1.46% -1.38% -1.48% -1.72% -1.29% -1.67% -1.29% -0.46%
Max Decline -5.29% -2.07% -5.27% -4.78% -3.72% -7.55% -4.23% -3.57% -9.22% -5.95% -2.30%
Avg Days to Max Decline 8 6 6 8 13 9 10 8 7 8 2
2007 Contract Condition Yes   Yes Yes Yes     Yes Yes Yes  
Action Yes   Yes Yes Yes     Yes Yes No  
Copyright © 1989- Moore Research Center, Inc. All Rights Reserved.
Condition 2: Lower Monthly Close.
Action ---> Sell that month's close with objective of penetrating month's low within 2 months.
Tested Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov
Tested Years 45 45 45 45 45 45 45 45 45 45 45
Closed Lower 16 22 15 14 20 20 26 19 24 16 16
Penetrated Low 14 15 10 7 13 15 19 14 17 9 15
Scenario Percentage 88% 68% 67% 50% 65% 75% 73% 74% 71% 56% 94%
Avg Max Decline 5.16% 5.17% 4.42% 6.35% 6.75% 7.87% 8.22% 6.93% 6.62% 4.91% 14.05%
Max Decline 11.84% 16.11% 7.85% 14.97% 27.31% 21.63% 22.00% 16.66% 32.75% 14.91% 36.34%
Avg Days To Max Decline 16 15 17 18 19 20 19 16 15 12 11
Avg Max Increase -1.12% -1.47% -1.85% -2.10% -1.67% -2.01% -1.62% -2.94% -1.87% -0.56% -3.18%
Max Increase -4.05% -6.07% -5.08% -4.02% -6.64% -5.37% -7.69% -11.34% -4.50% -2.75% -10.65%
Avg Days to Max Increase 7 7 10 15 8 10 6 12 9 5 18
2007 Contract Condition   Yes       Yes Yes       Yes
Action   Yes       Yes Yes       Yes
High 1441.60 1461.55 1438.90 1498.00 1535.55 1540.55 1555.90 1503.90 1538.75 1576.10 1545.80
Low 1403.95 1389.40 1364.00 1416.35 1476.70 1484.20 1454.25 1370.60 1439.30 1489.55 1406.10
Close/Last 1438.25 1406.80 1420.85 1482.35 1530.60 1503.35 1455.25 1474.00 1526.75 1549.40 1481.15

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Newsflash

Think again! Fed cuts and MRCI seasonal trends could unlock profits in Treasuries. Challenge yourself to explore the TLT ETF and futures. https://www.barchart.com/story/news/33123477/lower-interest-rates-in-the-3rd-quarter-opportunities-for-traders-and-consumers

Historical research from Moore Research Center, Inc. (MRCI) highlights a seasonal tendency for Treasury prices to rise and yields to fall in July. This pattern holds across the 5-year, 15-year, and 30-year seasonal patterns, implying that the fundamentals during this period have been relatively consistent, driven by market dynamics and investor behavior. July often sees reduced trading volumes due to summer slowdowns, which can amplify price movements in bonds. Investors may rebalance their portfolios in the third quarter, as the end of September marks the Federal government's year-end, which is expected to increase demand for Treasuries.

This seasonal trend offers traders a potential edge. For instance, MRCI data shows the 10-year Treasury note often rallies in July, with prices rising as yields dip. This could be a short-term opportunity for those positioned in Treasury futures or ETFs. However, seasonality is not a guarantee; traders must combine it with other analyses, such as technical indicators or macroeconomic trends, to make informed decisions.