Over the last few days, markets have been confronted by a confused message. On the one hand, the Feds recent messaging has become more dovish indicating that the recent surge in yields could mean the federal reserve doesn’t need to hike in November. However, on the other hand, the PPI print on Wednesday surprised significantly to the upside indicating the Fed had more work to do.  

So this means the CPI print today and the University of Michigan consumer sentiment print on Friday could greatly impact the outlook for the S&P 500. If we see a big miss in the data, then there could be some significant upside for US stocks ahead. 

Looking at the S&P 500 from a seasonal perspective, we can see that the S&P 500 has gained 83% of the time over the last 25 years between October the 10 of December for 31st. This has been for an average 4.31% gain. So does this mean the S&P 500 will repeat its usual Q4 gains? Will the seasonals play out regardless of the CPI print?  

Major Trade Risks: 
The major trade risk here is if it appears that the US economy looks set to head into a deep recession which could seriously undermine stocks.  

Remember don’t just trade it, Seasonax it!