S&P500 index tends to top out near US Presidential inaugration day
We observe that S&P500 index tends to top out near the US Presidential inaugration day.
The pattern is more pronounced when we get a change in regime of presidents with more than one term, and at the same stock market at all time high.
Obama's two term cycle is ending in 20 January 2017 when President elect Trump would take over.
Why does this happen?
After the election, hopefulness and euphoria usually sends stocks higher because "everybody assumes that whatever's wrong is going to get changed or fixed by the new guy even though nobody's doing anything yet in terms of governing.
However, the morning after the inauguration, people realize the problems still exist and it will take longer to fix them.
That tends to bum everyone out and so they sell their stocks.
Link: https://www.google.com.sg/amp/www.cnbc.com/amp/2016/11/29/trump-market-rally-will-end-after-inauguration-expert-predicts.html?client=ms-android-oppo
Charts from Phillip Securities
The pattern is more pronounced when we get a change in regime of presidents with more than one term, and at the same stock market at all time high.
Obama's two term cycle is ending in 20 January 2017 when President elect Trump would take over.
Why does this happen?
After the election, hopefulness and euphoria usually sends stocks higher because "everybody assumes that whatever's wrong is going to get changed or fixed by the new guy even though nobody's doing anything yet in terms of governing.
However, the morning after the inauguration, people realize the problems still exist and it will take longer to fix them.
That tends to bum everyone out and so they sell their stocks.
Link: https://www.google.com.sg/amp/www.cnbc.com/amp/2016/11/29/trump-market-rally-will-end-after-inauguration-expert-predicts.html?client=ms-android-oppo
Charts from Phillip Securities
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