[Chart courtesy of MarketWatch.com]
- Moving the market
Stocks came out of the gate with conviction today as investors welcomed a decisive Democratic victory in the midterms and, perhaps more importantly, President Trump’s willingness to accept the results. Markets love many things, but certainty may be their favorite.
The combination of a divided Washington, falling oil prices, and easing bond yields gave traders plenty to cheer about. Crude tumbled nearly 8% on hopes of less escalation in Iran, pulling yields and the dollar lower while giving a boost to gold, crypto, and risk assets across the board.
There was also a healthy dose of history in the air. Since 1950, the S&P 500 has been higher one year after every midterm election, with average gains of roughly 15%.
Of course, past performance is not a guarantee of future results, but it’s a statistic bullish investors were more than happy to quote today.
For now, the market seems relieved that politics may be taking a back seat to earnings, growth, and lower energy prices.
The question is: will this post-election rally have staying power, or did the market just enjoy its first sugar rush of a potentially different political backdrop?
2. Current domestic “Buy” Cycle (effective 5/20/2025); International “Buy” Cycle (effective 5/8/25)
Our domestic bullish cycle that began on November 21, 2023, concluded on April 3, 2025, following a market downturn triggered by President Trump’s tariff policy announcement.
This development caused significant declines across major indexes and broader market indices. However, markets subsequently rebounded, culminating in a new domestic “Buy” signal taking effect May 20, 2025.
Concurrently, our International Trend Tracking Index (TTI) experienced parallel volatility. On April 4, 2025, it breached critical thresholds, prompting a “Sell” recommendation. This position reversed as global markets recovered, with the International TTI regaining sufficient momentum to issue a new “Buy” signal effective May 8, 2025.
3. Trend Tracking Indexes (TTIs)
The bulls were up before the alarm clock and never looked back, pushing the major indexes higher, with the Dow leading the charge.
Gold and silver decided they didn’t want to be left out of the party, comfortably outpacing the stock market’s gains.
Our TTIs joined the celebration as well, advancing more than both the S&P 500 and Nasdaq.
All in all, it was a rewarding day for investors who stayed focused on their portfolios instead of treating the midterm elections like a sporting event.
This is how we closed 11/04/2026:
Domestic TTI: +7.98% above its M/A (prior close +5.81%)—Buy signal effective 5/20/25.
International TTI: +4.93% above its M/A (prior close +3.14%)—Buy signal effective 5/8/25.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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