S&P 500 Forecast for the Week Ahead: The Summer Doldrums Drag On
S&P 500 Forecast for the Week Ahead: The Summer Doldrums Drag On
By:Peter Hanks
S&P 500 PRICE FORECAST:
· The S&P 500 has seen some of its tightest daily trading ranges in the last three years this week
· History suggests the trend of low volume and volatility may persist as summer progresses
· Holiday trading conditions may distort upcoming price action - Stock Market 2021 Holiday Calendar
S&P 500 FORECAST FOR THE WEEK AHEAD: THE SUMMER DOLDRUMS DRAG ON
The S&P 500 is on pace for another sleep-inducing week of trade as the effects of seasonality seem to grow stronger. Daily trading ranges have continued to narrow and market activity could be further distorted by the upcoming holiday weekend. The summer doldrums, a trend toward lower volume and volatility this time of year, seem to be in full swing and unfortunately for the more active traders, could persist in the weeks ahead if history is any indication.
To that end, monthly S&P 500 data since 1990 reveals April to September is generally the period with the lowest volume of the year and tends to bottom in August. After a fairly uneventful conclusion to May and a largely inactive month of June, the trend of lower volume and volatility in the summer season seems poised to ring true this year.
With that in mind, market activity could slip to new lows in the coming months as traders grasp for any viable catalysts after almost 18 months of negotiating a novel market environment that saw volatility remain elevated for long periods. Whether recent price action is simply a side effect of investor fatigue rather than the underlying forces of seasonality is yet to be seen, but the trend thus far suggests the latter may carry more weight.
That said, a lack of activity has not translated to a lack of progress for the major indices as the S&P 500 and Nasdaq 100 push to new records – albeit slowly – while the Dow Jones attempts to reclaim a lost trendline that had been crucial in its climb off the pandemic lows. Despite underwhelming price action, the continuation higher is encouraging and suggests the longer-term uptrend in equities remains firmly intact. As markets search for the next catalyst, follow @PeterHanksFX on Twitter for updates and analysis.
Written by Peter Hanks, Strategist for DailyFX.com
Contact and follow Peter on Twitter @PeterHanksFX
Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.
tastylive content is created, produced, and provided solely by tastylive, Inc. (“tastylive”) and is for informational and educational purposes only. It is not, nor is it intended to be, trading or investment advice or a recommendation that any security, futures contract, digital asset, other product, transaction, or investment strategy is suitable for any person. Trading securities, futures products, and digital assets involve risk and may result in a loss greater than the original amount invested. tastylive, through its content, financial programming or otherwise, does not provide investment or financial advice or make investment recommendations. Investment information provided may not be appropriate for all investors and is provided without respect to individual investor financial sophistication, financial situation, investing time horizon or risk tolerance. tastylive is not in the business of transacting securities trades, nor does it direct client commodity accounts or give commodity trading advice tailored to any particular client’s situation or investment objectives. Supporting documentation for any claims (including claims made on behalf of options programs), comparisons, statistics, or other technical data, if applicable, will be supplied upon request. tastylive is not a licensed financial adviser, registered investment adviser, or a registered broker-dealer. Options, futures, and futures options are not suitable for all investors. Prior to trading securities, options, futures, or futures options, please read the applicable risk disclosures, including, but not limited to, the Characteristics and Risks of Standardized Options Disclosure and the Futures and Exchange-Traded Options Risk Disclosure found on tastytrade.com/disclosures.
tastytrade, Inc. ("tastytrade”) is a registered broker-dealer and member of FINRA, NFA, and SIPC. tastytrade was previously known as tastyworks, Inc. (“tastyworks”). tastytrade offers self-directed brokerage accounts to its customers. tastytrade does not give financial or trading advice, nor does it make investment recommendations. You alone are responsible for making your investment and trading decisions and for evaluating the merits and risks associated with the use of tastytrade’s systems, services or products. tastytrade is a wholly-owned subsidiary of tastylive, Inc.
tastytrade has entered into a Marketing Agreement with tastylive (“Marketing Agent”) whereby tastytrade pays compensation to Marketing Agent to recommend tastytrade’s brokerage services. The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastytrade. tastytrade and Marketing Agent are separate entities with their own products and services. tastylive is the parent company of tastytrade.
tastycrypto is provided solely by tasty Software Solutions, LLC. tasty Software Solutions, LLC is a separate but affiliate company of tastylive, Inc. Neither tastylive nor any of its affiliates are responsible for the products or services provided by tasty Software Solutions, LLC. Cryptocurrency trading is not suitable for all investors due to the number of risks involved. The value of any cryptocurrency, including digital assets pegged to fiat currency, commodities, or any other asset, may go to zero.
© copyright 2013 - 2024 tastylive, Inc. All Rights Reserved. Applicable portions of the Terms of Use on tastylive.com apply. Reproduction, adaptation, distribution, public display, exhibition for profit, or storage in any electronic storage media in whole or in part is prohibited under penalty of law, provided that you may download tastylive’s podcasts as necessary to view for personal use. tastylive was previously known as tastytrade, Inc. tastylive is a trademark/servicemark owned by tastylive, Inc.