Chart of the Day - Monday, December 27th, 2021

TOY (Turn of Year) Barometer has begun
by Wayne Whaley

-Nov. 19 - Jan. 19.
-Bullish if >3% $SPX return during this time period.
-n=36
-Forward 12-month SPX returns = 16.4%
-% positive rate= 96%
-Down in 1987 & 2018 only
-Fired bullish in 2021, up 26%+$SPY pic.twitter.com/TQfAP6brCZ

— Seth Golden (@SethCL) December 27, 2021

Today’s Chart of the Day was shared by Seth Golden (@SethCL). The famous Santa Claus Rally period began today, but we've talked enough about that recently so we won't go there. In case you missed it, you can read all about the Santa Claus Rally here. Seth highlights another prescient seasonality indicator that's worth paying attention to right now - the Turn of the Year Barometer. Wayne Whaley discovered this phenomenon years ago when he set out to find the "kingpin of seasonal barometers." It has a pretty impressive track record at predicting the performance of the S&P 500 over the next year. A bullish signal triggers when the S&P 500 gains 3% or more in the two-month period between November 19th and January 19th. Of the 36 bullish signals since 1950, the S&P 500 was positive one year later about 95% of the time for an average gain of 16.4%. The Turn of the Year Barometer is off to a good start so far this year with the S&P up nearly 2% since November 19th. Keep an eye on how it plays out over the next few weeks.