The Stock Traders Almanac is forecasting what it calls a “monster Q4 rally,” projecting that the S&P 500 could climb to 7100 before 2025 comes to a close. In its October market outlook, the group said the bearish seasonal patterns that usually weigh on equities have not emerged this year, leaving room for a strong final push.
“After the tariff tantrum that sent the S&P 500 down 18.9% on a closing basis to the April 8 low, the market has soared for five months straight,” the Almanac wrote. “So much for ‘Sell in May’ this year.”
The firm emphasized: “When bearish seasonality doesn’t transpire it is a bullish indication that more powerful forces are at play.”
September, a month often marked by weakness, delivered eight fresh all-time highs for the S&P 500. The Almanac highlighted this as an encouraging sign: “Q4 performance has historically been solid but it also improved following five or more new all-time highs in September with only one loss in 8 years.” The only fourth-quarter loss under those conditions occurred back in 1967, it noted.
Still, the Almanac cautioned that some obstacles remain, pointing to “valuations running hot, a few disappointments from the AI Tech camp and another looming government shutdown.”
Despite those risks, the firm maintains that any weakness will be temporary. “We still anticipate any pullback or retreat to be relatively brief and shallow,” it said.
Ultimately, the Almanac expects momentum to carry the rally into year-end. “After this dip we expect a banner Q4 rally that should drive the S&P 500 up to 7100 by year-end for another 20% yearly gain,” it concluded.
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