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The difference in means (5%) is statistically indistinguishable from random given the high standard deviation of stock returns

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I checked to make sure a strong Year 3 was not the result of a weak Year 2. It's not. Since 1950: 18 presidential cycles of which only 6 where Year 2 gained >10% Avg. Year 3 return following a strong Year 2: +13% (range: +2% to +31%) Avg. Year 3 return following a weak/normal Year 2: +18%

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Every year of the cycle is statistically indistinguishable from average, except Year 3 (from Mark Hulbert)

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Urban Carmel @ukarlewitz.bsky.social · 23/09/2026

Year 3 of the four year cycle is the ONLY year statistically better than the others. Missing in the chart below in 2022-23 when SPY gained ~17%

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Market reacting to today's PMI data. It's a silly measurement, not accurate with respect to the economy or future equity returns. Why? One small firm expanding a tiny bit is counts the same as the largest firm contracting by a massive amount. That's how diffusion indices work. Noise not signal

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Urban Carmel @ukarlewitz.bsky.social · 22/09/2026

That was the weekly closing high. 6 weeks later, XLF is down 6% bsky.app/profile/ukar...

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Urban Carmel @ukarlewitz.bsky.social · 21/09/2026

$COMPQ at a new ATH for the first time since early June. $IWM near a 3-month low and 6% off its August ATH.

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Urban Carmel @ukarlewitz.bsky.social · 21/09/2026

This is regarded as the weakest week of the year

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Urban Carmel @ukarlewitz.bsky.social · 17/09/2026

Initial UE claims just 196k this week. Context (below) bsky.app/profile/ukar...

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Urban Carmel @ukarlewitz.bsky.social · 17/09/2026

SPY +1.5% since touching its 20-wma (scroll up). Context (below) bsky.app/profile/ukar...

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At the 20-wma, first time since April

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Longer-term, SPX has most often (but not always) peaked after the first rate hike; the exception was in 2022 when a >20% drop came next. I can't believe I called some of you geezers

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In the past, US equities weak 1-3 mo after first rate hike, even if it occurs with SPX near an ATH (like now)

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Urban Carmel @ukarlewitz.bsky.social · 15/09/2026

Real retail sales +2.6% yoy; ex-gas +1.5%. Fun fact: real ex-gas retail up less than 1% over the past 5+ years. Retail sales are fine but not en fuego

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BAML fund managers contrarian trade: short US equities, banks and large caps; long REITs, small caps, staples

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Urban Carmel @ukarlewitz.bsky.social · 11/09/2026

RSP still perfect on 9/11. Enjoy your weekend

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Urban Carmel @ukarlewitz.bsky.social · 11/09/2026

US stocks have historically rallied on 9/11 since 2002. RSP has been up all 17 times. From Gemini

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Urban Carmel @ukarlewitz.bsky.social · 09/09/2026

This sums up most breadth analyses. First chart: weak breadth is a buying opportunity. Second chart: strong breadth is a buying opportunity.

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Urban Carmel @ukarlewitz.bsky.social · 04/09/2026

Aug NFP of 162k vs 55k expected. 90% confidence interval is +/-120k, so any print 40-280k is statistically indistinguishable from expected. This wasn't a blowout. Remember that ‘blowout’ May NFP of 172k. Final revision: 63k. Anyone learn from this? Same day employment reactions are the worst.

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Urban Carmel @ukarlewitz.bsky.social · 03/09/2026

There was also a substantial $18b outflow from domestic MF + ETF equities last week (ICI). That's the first big outflow in a year. Nothing's perfect but this is usually a positive

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Urban Carmel @ukarlewitz.bsky.social · 03/09/2026

Fear & Greed has halved over past week. When it is <30 and SPX is >200-d, SPX is higher 85% of the time by 6% six months later. That win % is robust relative to 'anytime' and mean/median are nearly identical, so distribution is symmetrical (one year less so). From @sentimentrader.bsky.social

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Urban Carmel @ukarlewitz.bsky.social · 02/09/2026

This is not sentiment. This is: Asset/(Equity+Bond+Cash). As equity prices go up, so does the allocation to equities as a % of the total. That's why the equities % exactly peaks with the bull market and exactly bottoms with the bear market. Investors reallocate on the margin; that's sentiment.

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Urban Carmel @ukarlewitz.bsky.social · 02/09/2026

At the start of the year, the consensus saw extremely low recession risk and both stronger growth and lower inflation in the next year. The 2-yr was well below the FFR. That's not a combo where the Fed is cutting

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Urban Carmel @ukarlewitz.bsky.social · 01/09/2026

The midterm seasonality calendar has been right only once in the first 8 months

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Urban Carmel @ukarlewitz.bsky.social · 31/08/2026

Love this. September in mid-term years has been both the worst and the best. If something can be both the worst and the best then there’s no pattern. Using an average just masks a huge standard deviation. That, in a nutshell, is why seasonality is so worthless

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Urban Carmel @ukarlewitz.bsky.social · 28/08/2026

A lot of equity call buying relative to puts, with CPCE dropping to just 0.39 yesterday. The last one was end of May before choppy June. Here’s an old chart from 2021. You get the idea

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Urban Carmel @ukarlewitz.bsky.social · 25/08/2026

This was the end of the advance. SPX was more than 1% lower at yesterday’s close, 8 days later

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Urban Carmel @ukarlewitz.bsky.social · 23/08/2026

Follow the data, which shows it’s closed.

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Urban Carmel @ukarlewitz.bsky.social · 21/08/2026

$SPX is up +3.7% the last 4 wks. It has gained +4.6% overnight and lost -0.9% during market hrs

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Urban Carmel @ukarlewitz.bsky.social · 20/08/2026

When QQQ drops 5 days in a row and the index is >200-d, then 20-d forward returns avg 4.5% (vs 1.2% anytime). 78% win rate means high likelihood, not certainty. 95% CI between +2.8% and +6.4%. From Gemini

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Urban Carmel @ukarlewitz.bsky.social · 20/08/2026

Your periodic reminder that bullish and bearish extremes are not the same bsky.app/profile/ukar...

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Urban Carmel @ukarlewitz.bsky.social · 20/08/2026

Objectively, AAII is an outlier. 1. BAML fund mgrs very bullish (scroll up) 2. Investor Intelligence: Bulls outnumber bears by 3.7x 3. US equity fund inflows (MF+ETFs) past 6 wks: +$30b 4. Equity put/call past 4 wks: 0.6 5. Consensus Bulls: 76% On balance, hard to argue that investors are bearish

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Urban Carmel @ukarlewitz.bsky.social · 19/08/2026

Today is 3 weeks later and $SPX is still up nearly 6%. It hasn't traded lower than the trigger date even once.

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Urban Carmel @ukarlewitz.bsky.social · 18/08/2026

BAML fund managers: equity overweight the highest in 5 yrs, cash allocation the 6th lowest since 1998. Allocations to US equities, commodities and banks over +1 std dev from long term mean while staples and cash under -1 std dev

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$SPX up 3 wks in a row for the first time since May. 94% of the gain during these 3 wks has come overnight, gapping up 13 of 15 days

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XLF daily RSI(5) at 95. It has been >90 only eight other times, only one of which didn't chop around in the months ahead and just zoomed higher. Also small n. Momentum is great until it's overcooked

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XLF set to close higher an 11th week in a row, a record. It has twice closed higher 9 wks in a row. 2004: it went higher the next month, gave it all back and went net nowhere for more than a yr. 2010: it soon dropped ~20% and went net nowhere for 2-1/2 yrs. This is n=2 so it's for cocktail chatter

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