Provided below is a graphical display of the professionally favored and broadly watch Large Cap Stock Market Index, the $SPX.
The SPX is the favored index, and "general stock market measure" used by professional analyst and investment managers both domestically and globally. It is held as the predominate and most representative measure of the US Large Cap Securities Market.
ProtectVEST By EchoVectorVEST is presenting below a GuideChart of the SPX which illustrates the effects of the (1) Presidential Election Cycle and the (2) Congressional Election Cycle on the price level of the SPX.
In this illustration, ProtectVEST is focusing particuarly on the effect of the old Wall Street adage "Sell in May and Go Away", and how this adage is (1) illustratively pronounced in Presidential Election Cycle years and Congressional Cycle Years, and (2) how it can lead to the start of, and cascade into a precipitous and major Stock Market selloff's in Regime Change Cycle Election years (which are usually every eight years, but can occur, post facto, in four years as well.)
Also illustrated is how immediatley preceding annual echovector cycles can also foreshadow the May selloff (see the May 2011 and May 2010 echovectors highlighted in beige)
READING THE ProtectVEST by EchoVectorVEST SPX GUIDECHART:
1. Click on the Chart and then Click again to both enlarge and zoom the chart. Use your optimum display settings also.
2. The SPX GuideChart is a 10-Year Weekly OHLC (Open/High/Low/Close) Price Bar chart
3. The Congressional Election Cycle is displayed in alternate yellow and agua-blue vectors, in order to discern every two years along the chart from the key First Trading Week of May bar and its high price lmore clearly.
4. The selloff from the first week of May to the traditional 2ND or 3RD Week of August is displayed with a red vector. The white bars located under Congressional Cycle or located on the weekly OHLC (Open/High/Low/Close) price bar line also display these annual sell-off sums.
5. In solid green are the correlate dates of the weekly bars beginning the selloff the first trading week in May for the cycle years.
6. In solid red are the correlate dates of the weekly bars completing the selloff sum at that time. Notice that in many cycle years 'lower lows' are achieved before this date.
7. The horizontal solid pink line illustrates how the SPX has achieved the nearly perfect correlate price level to May four years earlier, on a weekly closing price basis. This is often referred to as a resistance price level vector (with respect to the expressed specific time quantity (in this case, being four years).
8. The eight-year long dotted-green lines represent key price vectors and ascending price channels identified by EchoVectorVEST MDPP.
9. Notice the magnitude of the selloff from (1) the first week in May of Regime Change Cycle Election year, or, (2) as measured from its preceding year's summer price high.
We hope this chart helps demonstrate the prudence of applying price level insurance to major market funds and ETFS. These funds and ETFs tend to account, on average, for 65% of the typical total portfolio exposure existing under passive professional management regiments and affiliations.
The historical reward-to-risk ratio of proceeding beyond THE FIRST WEEK OF MAY without 'major stock market exposed' portfolio price level 'insurance' applications, or procedding to just continue along within 'full uninsured passive portfolio management portfolio exposures', would seem unjustified, imprudent and potentially counter-productive and possibly destructive to overall accrued, and time-already-spent-earned, portfolio value. And quite frankly, proceeding as such might also even be considered "blind" and "managerially archaic and inept."
In the present era of active and advance financial management and financial position and holdings value optimization techniques, better price protection strategies and portfolio management and portfolio value enhancement opportunities are available.
ProtectVEST And ADVACEVEST by EChoVECTorVESTDivisions of Motion Dynamics and Precision Pivots
Bradford Market Research and Analytics
"We're keeping watch for your!"
SPX 10-Year Weekly OHLC GuideChart
Disclosure: I am short SPY.