July Bullish Seasonality Not Disappointing

At the end of every update, I bring everything together summarizing my view on the market using the information here, while also considering research from bulge bracket banks which I read on a regular basis.

Index Models (Based on Option Flows)

Note: Red zone is bearish where investors should sell positions, green zone is bullish where investors should accumulate positions (neutral = coin toss). Signals in the index models drive the bias for single stock positions (i.e., if index models are bearish, going long a single stock within the index isn’t smart regardless of the underlying signal).

Worth noting how my models define bearish and bullish. Bullish is better than historically average returns for the underlying and bearish is below average returns. Key point: bearish does not necessarily mean negative returns are expected, but if they do occur, they are most likely to occur when the model is bearish.

S&P 500 SPY 0.00%↑ 5 Trading Day (TD) Risk Model

Current Signal: Bearish

S&P 500 SPY 0.00%↑ 15 TD Risk Model