Why The S&P 500 Monthly Win Streak Could Have Bulls Smiling

The run stocks have been on since the February ’16 lows is truly an impressive feat. Per Ryan Detrick, Senior Market Strategist, “The S&P 500 is up 10 consecutive months on a total return basis and has been higher 17 of the past 18 months. Other than those test rockets Elon Musk is firing into outer space, not much has been consistently higher than equities over this timeframe.”

So on a total return basis the S&P 500 is up 10 consecutive months, but take note this does include dividends. Going by only price shows it has been higher five consecutive months for the first time since a five-month win streak coming off the February ’16 lows. Here’s the catch, going back in history a five-month win streak is one of the more bullish signals for longer-term returns. According to Ryan Detrick, “This is the 25th time the S&P 500 was up five straight months since 1950. The good news for bulls is a year later it was higher 23 out of the previous 24 times and higher 13.2% on average.”

Be aware though, that this current streak was also the weakest return over a five-month win streak at +4.6%. None the less, although near-term we could see an increase in volatility, we believe this is one the bulls can hang their hat on that the bull market is far from over.

Five Month Win Streak

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Past performance is no guarantee of future results.

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