The
month of April is statistically the best month for the Dow Industrials with
average gain of 1.8% since 1950, according to Stock Trader’s Almanac. STA
points out that April is rarely a dangerous month “except in big bear markets
(like 2002).” It’s worth pointing out,
however, that even in the devastating bear market year of 2008 the month of
April saw a gain for the Dow. The
so-called “Best Six Months” of the year end with April (i.e. “Sell in May and
go away”).
There
are a couple of minor cracks in the edifice still in need of repairing, but I’m
encouraged by the market’s overall technical.
One of those “cracks” is of course the NASDAQ 100 (NDX), which is still
below its previous high from early March and which took the brunt of the March
correction. NDX did manage to find
support above its technically significant 90-day moving average, however, which
is a positive sign.
[Excerpted
from the Apr. 2 issue of MomentumStrategies Report]
