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Riding the Bear to the Midterm Bottom and the "Sweet Spot" of the Four-Year Cycle

Released on Tuesday, July 12, 2022•MARKETS

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Unfortunately, the stock market is delivering on its bearish historical four-year cycle and seasonal tendencies here at the midway point of 2022 in line with Jeff's forecast. The intersection of the annual seasonal pattern and the four-year cycle produces the quadrennial Sweet Spot. As we continue to patiently ride out this bear quadrennial pattern may provide some solace. 2022 is setting up for a prototypical midterm bottom hitting its low point in late Q3 or early Q4 in the August-October period, just ahead of the midterm elections. Jeff will show you how to navigate this volatility and be ready for the next bull market rally. Inflation is stubbornly remaining at multi-decade highs, the Fed is tightening, sentiment is bearish, support levels are not holding, supply chain disruptions persist, there is conflict in Europe, and energy prices are at record highs for consumers. Continue to be patient as the weak spot of the four-year cycle will eventually give way to the sweet spot, likely sometime later in Q3 or in early Q4. Even with inflation at multi-decade highs, cash is likely the least risky place to wait.

Jeffrey Hirsch

The Stock Trader's Almanac & Almanac Investor, Editor-in-Chief

Jeffrey A. Hirsch is CEO of Hirsch Holdings, editor-in-chief of the Stock Trader's Almanac, and publisher of Almanac Investor at www.stocktradersalmanac.com. Mr. Hirsch is the author of The Little Book of Stock Market Cycles (Wiley, 2012) and Super Boom: Why the Dow Will Hit 38,820 and How You Can Profit from It (Wiley, 2011). He worked with founder Yale Hirsch for over twenty years, taking over for him in 2001. A 35-year Wall Street veteran, he appears on CNBC, Bloomberg, Fox Business, and many other financial media outlets. Now in its 57th year, the Stock Trader’s Almanac has been published every year since 1968.