The annual growth rate of the US core PCE price index in May hit a new low since March 2021. Although the data is just that, the impact on market sentiment is positive.
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[Data] May is poor, June is desperate, and July is a turnaround.
➤Reason 1: US stocks
From 2013 to 2023, the probability of the S&P rising in July is over 90.31% (only in 2014). The probability of the Nasdaq rising in July during this period is 100%.
Combining the S&P and the Nasdaq, July is the best performance period for US stocks in history.
The US economy and life do have an annual cycle. The tax season ends in May, and people will receive tax refunds from April to June, so May to August are relatively prosperous months for consumption. American movies also start a concentrated summer season at the end of May.
There are two explanations for the impact on the stock market. On the one hand, speculators took cash from the stock market for consumption in May and June, and returned in July. On the other hand, consumption during this period will also affect the real economy and be reflected in company financial reports.
➤Reason 2: July reversal
First, in July, the probability of the big cake rising is 63.64%.
Second, July may be due to the mid-year reason. We can see that July is the month with the highest probability of reversal relative to the previous month.
Third, the two times that there was no reversal from June to July were 2015 and 2017, both of which rose continuously.
In other words, BTC has never had a history of falling for two consecutive months from June to July.
Of course, there are only eleven or twelve years of samples, and the persuasiveness of the data is relatively limited.
➤ Reason three: Fed policy vacuum period
The Fed FOMC meeting is held about every 6 weeks. Therefore, some months will be skipped, forming a policy vacuum month.
The Fed will hold the next FOMC meeting on July 31, 2024, Eastern Time, and August 1, 2024, Beijing Time. Therefore, July this year is basically in a policy vacuum period.
After all, the current market is more sensitive to the Fed's policy, but during this vacuum period, the Fed has no monetary policy.
Of course, it is not ruled out that Powell or a certain official's speech will also affect the market, but this influence is smaller than the decision-making and formal speech of the FOMC meeting.
➤ Conclusion
Although each reason is not sufficient, when put together, the probability of a rebound in July will be greater.
In addition, pay attention to these three tables. In August and September, the performance of S&P, Nasdaq and Bitcoin was not good in history.
Brother Feng has suggested before that for profitable coins, you can consider looking for opportunities to reduce your positions in July, keep some bullets in your hand, and wait for the opportunity to buy the bottom later.
➤Reason 1: US stocks
From 2013 to 2023, the probability of the S&P rising in July is over 90.31% (only in 2014). The probability of the Nasdaq rising in July during this period is 100%.
Combining the S&P and the Nasdaq, July is the best performance period for US stocks in history.
The US economy and life do have an annual cycle. The tax season ends in May, and people will receive tax refunds from April to June, so May to August are relatively prosperous months for consumption. American movies also start a concentrated summer season at the end of May.
There are two explanations for the impact on the stock market. On the one hand, speculators took cash from the stock market for consumption in May and June, and returned in July. On the other hand, consumption during this period will also affect the real economy and be reflected in company financial reports.
➤Reason 2: July reversal
First, in July, the probability of the big cake rising is 63.64%.
Second, July may be due to the mid-year reason. We can see that July is the month with the highest probability of reversal relative to the previous month.
Third, the two times that there was no reversal from June to July were 2015 and 2017, both of which rose continuously.
In other words, BTC has never had a history of falling for two consecutive months from June to July.
Of course, there are only eleven or twelve years of samples, and the persuasiveness of the data is relatively limited.
➤ Reason three: Fed policy vacuum period
The Fed FOMC meeting is held about every 6 weeks. Therefore, some months will be skipped, forming a policy vacuum month.
The Fed will hold the next FOMC meeting on July 31, 2024, Eastern Time, and August 1, 2024, Beijing Time. Therefore, July this year is basically in a policy vacuum period.
After all, the current market is more sensitive to the Fed's policy, but during this vacuum period, the Fed has no monetary policy.
Of course, it is not ruled out that Powell or a certain official's speech will also affect the market, but this influence is smaller than the decision-making and formal speech of the FOMC meeting.
➤ Conclusion
Although each reason is not sufficient, when put together, the probability of a rebound in July will be greater.
In addition, pay attention to these three tables. In August and September, the performance of S&P, Nasdaq and Bitcoin was not good in history.
Brother Feng has suggested before that for profitable coins, you can consider looking for opportunities to reduce your positions in July, keep some bullets in your hand, and wait for the opportunity to buy the bottom later.
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