Sell in May and Go Away

Sell in May and Go Away
By www.ProfitableTradingTips.com

http://profitabletradingtips.com/profitable-trading-tips/sell-in-may-and-go-away
Stock market trading volume has
fallen dramatically.

Is it that traders are following the old
adage, sell in May and go away?
investopedia defines this term.

Before We Continue…
Click the links below to get your
FREE training materials.
Free Weekly Investing Webinars
Don’t miss these free training events!
http://www.profitableinvestingtips.com/free-webinar
Forex Conspiracy Report
Read every word of this report!
http://www.forexconspiracyreport.com
Get 12 Free Japanese Candlestick Videos
Includes training for all 12 major candlestick signals.
http://www.candlestickforums.com

[sell in may and go away is a] well-
known trading adage that warns
investors to sell their stock holdings
in may to avoid a seasonal decline in
equity markets.

the “sell in may and go away”
strategy is that an investor who sells
his or her stock holdings in may and
gets back into the equity market in
november – thereby avoiding the
typically volatile may-october period
– would be much better off than an
investor who stays in equities
throughout the year.

Historically the summer is a quieter
time in the market that the fall, winter
and spring.

Not in a Rush to Go
Anywhere

The wall street journal reports on
the lowest volume in months in
the market.

stocks also are in no rush to go
anywhere.

the dow jones industrial average has
traded in a very narrow range so far
this week.

not only have they failed to rise or
fall more than 0.15%, something that
hasn’t happened since 2006, the
index has been unable to move in a
triple-digit range for four straight
sessions.

today the dow industrials are on
track to end a whopping 0.02%
higher.

the slow crawl leading up to
memorial day is a tradition for
markets.

the week leading up to memorial day
last year also posted the slowest
trading volumes since the first week
of the year (with 5.13 billion shares
changing hands)

and the four-day week following
didn’t provide much of a pickup (5.47
billion shares were traded).

and don’t expect volumes to pick up
anytime soon.

if last year is any indication, this is
the new normal for the rest of
summer.

in 2014, from the week leading up to
memorial day to the week of labor
day the weekly number of shares
changing hands was 5.44 billion, well
below the weekly average of 6.27
billion for all of 2014.

The Journals take is that this just a
seasonal matter.

Another issue this year is that the
market may have peaked and is
perhaps set for a correction.

Signs of a Correction

The market has resumed its climb
this year even as growth has slowed.

forbes writes about the possibility of
a stock market correction.

while predictions of upside or
downside breakouts continue, there
has been little meat behind them –
until now.

four concerns are rising in
significance enough to be taken
seriously.

without a robust uptrend to counter
them, these issues could trigger a
market correction.

The four concerns cited are these:
•Weak growth
•Mixed performance of individual
stocks
•Interest rate worries
•Dow theory (transportation average
has corrected)

If you abide by the theory that stocks
are stagnant in the summer you may
sell or simply hold and go on vacation
until the fall.

But, if you are concerned about the
Dow transportation average already
correcting and a general weakening of
the economy you will sell in May and
go away until the correction has
happened and then use your
stockpiled cash to pick up bargains.

Sell in May and Go Away

Recomendados

Recomendados

Mais conteúdo relacionado

Mais de InvestingTips

Mais de InvestingTips (20)

Último

Último (20)

Sell in May and Go Away