Self Directed Investor Inc
SDI: "Empowering investors with ideas and education"
Symbol Lookup »  
Topics:ChinaETFsEarningsEconomyEnergyForexGoldIncomeLessonsIdeasTrading

  • Other news: News from PR Newswire
| More

Charting the SP500 Outcome of Elections Past

Mon, Nov 5, 5:12 PM ET, by Corey Rosenbloom

With Election Day Tuesday and the market at a pivot point that determines how we play the next swing, I thought it would be a good opportunity to look at the outcome going toward December of the past four US Presidential Elections.

Let’s start with the set-up and outcome of 2000 and move forward to today’s structure:

For those of you who remember the famous 2000 election, the winner was not officially known until a month after election day.

With Election Day on November 7th, the S&P 500 was on a swing toward the 1,450 level with daily reversal candles forming as the election approached.

When the market opened Wednesday morning with the election outcome in dispute, the market fell 30 points to start a sustained down-swing that ended at 1,300.

After a counter-trend rally in early December, the market fell sharply after Governor Bush was declared the winner and thus President-Elect.

I must admit that I assumed the market rallied sharply on this news but this was not the case.

Structure was in a downtrend and the election outcome – on Election Day and when the President-Elect was announced – resulted in high-points of counter-trend upwswings in a new downtrend that would last all the way to October 2002’s bottom.

President Bush’s re-election in 2004 was announced late in the evening of Election Day:

I included the Red/Green “IF/THEN” arrows which we’ll see shortly in the current 2012 chart so use this as a similar reference (an incumbent running for re-election).

After stagnating through most of 2004, a clear resistance trendline developed into the 1,140 area as Election Day 2004 approached.

When President Bush was declared the winner (of Ohio and thus the election) late into the evening, the market responded bullishly with an immediate breakthrough of the resistance level that sparked a rally that lasted all the way to the end of 2004.

One assumes that had the outcome again been in doubt, the market could have developed a down-swing from resistance as an “alternate” outcome.

Unlike the current election, candidate Obama was heavily favored in the polls against John McCain and the election was decisive:

After a clear election outcome Tuesday evening, the market opened the next day with a sharp sell-off and break back under 1,000 to start a fresh down-swing in the context of an established downtrend that began in October 2007.

Like 2000, the election corresponded with the peak of a counter-trend upswing ahead of a sell-off swing into the end of the year.

The past three elections reveal a “spit decision” of two sell-off outcomes (into December) and one sharp rally outcome (2004).

Here is how the market structure exists as we approach Election Day 2012:

While I don’t plan to make a formal prediction on the state of the election, I’ll just focus on the current structure of the market at a short-term turning point between a new pro-trend upswing off 1,400 or else a breakdown and short-term reversal swing under 1,400.

Polls and pundits point to a narrow win for either candidate and the potential that the outcome is unlikely to be known as soon as the polls close on election evening.

In the event that the election results are in dispute into the next trading morning, this outcome would favor the “Breakdown” thesis where 1,400 may break as support.

Otherwise, just because a winner is declared does not mean the market will automatically rally in a knee-jerk reaction (reference 2008).

If you’re a political news lover like me, stay tuned to the election night coverage to know the winner as soon as possible.

Otherwise as you wake up getting ready to trade the market on Wednesday morning, feel free to use these historical charts as a reference with respect to the key “bull/bear” pivot level near 1,400 currently in play.

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter: http://twitter.com/afraidtotrade

Corey's new book The Complete Trading Course (Wiley Finance) is now available!

blog.afraidtotrade.com


SDI Glossary: "Finance" Definition
This Article's Word Cloud:   After   Bush   Corey   December   Elect   Election   October   President   Wednesday   afraidtotrade   after   approached   counter   current   declared   down   downtrend   election   evening   into   known   late   level   market   morning   next   outcome   past   pivot   point   points   polls   rally   reference   resistance   reversal   sell   start   structure   swing   that   this   thus   toward   trend   under   upswing   winner   with   would

| More

December 2 Emini Fibonacci Retracement Grid Update
Fri, Dec 2, 1:31 PM ET, by Corey Rosenbloom

After an initial bounce just above our official Emini Fibonacci Target, price appears to be ...

December Downward Emini Retracement Takes Over
Thu, Dec 1, 2:31 PM ET, by Corey Rosenbloom

I’m thrilled to know that logic prevails and price is doing what it “should” at ...

Three Steps to a Trade a Collapse Lesson from Dryships DRYS and Qualcomm QCOM
Wed, Nov 30, 12:41 PM ET, by Corey Rosenbloom

I’m still surprised with how quickly Dryships (DRYS) surged from $5.00 to $100.00 but even ...

Our Make or Break Emini Level Update Nov 30
Wed, Nov 30, 11:51 AM ET, by Corey Rosenbloom

I’m not sure the buyers (bulls) know the meaning of a “pullback” but here we ...

Microsoft MSFT Gently Nudges to New High
Tue, Nov 29, 3:11 PM ET, by Corey Rosenbloom

Software giant Microsoft (MSFT) continue to be a “strong stock getting stronger” as evidenced by ...

Resilient Bulls Emini Fibonacci Grid Update Nov 29
Tue, Nov 29, 2:11 PM ET, by Corey Rosenbloom

I’m not sure the buyers (bulls) know the meaning of a “pullback” but here we ...

QuadMarket Holiday Trend Update Nov 28
Mon, Nov 28, 2:41 PM ET, by Corey Rosenbloom

We’ve seen all markets trend strongly after the US Election and Thanksgiving holiday November events. ...

Back to a Key Pivot Point for Swing Trading Apple AAPL Nov 28
Mon, Nov 28, 12:31 PM ET, by Corey Rosenbloom

Does Apple (AAPL) go higher or lower from $110? Build your next swing trade off ...

Finally Pulling Back from the Highs Emini Update Nov 28
Mon, Nov 28, 12:21 PM ET, by Corey Rosenbloom

Wait, the market can actually go DOWN? I had no idea! If you started your ...

The Emini Holiday Creep Continues Nov 23
Wed, Nov 23, 12:51 PM ET, by Corey Rosenbloom

Breakout? Pullback? Extended Uptrend getting more extended? Divergent Reversal? Let’s plan! Here’s today’s updated Emini ...

US Steel X Surges through Breakout Highs Nov 22
Tue, Nov 22, 2:51 PM ET, by Corey Rosenbloom

Expectations for future “stimulus” and transportation/spending projects from the new Republican administration sent raw materials ...

Yet Another Emini Divergence at the New Highs Nov 22
Tue, Nov 22, 12:21 PM ET, by Corey Rosenbloom

Breakout? Pullback? Extended Uptrend getting more extended? Divergent Reversal? Let’s plan! Here’s today’s updated Emini ...

Emini Breaks on Through to the Other Side Nov 21
Mon, Nov 21, 2:51 PM ET, by Corey Rosenbloom

Breakout? Pullback? Extended Uptrend getting more extended? Let’s plan! Here’s today’s updated Emini (@ES) trading ...

Post-Election Risk Trending Up in Treasuries and the Euro, Down in U.S. Stocks
Mon, Nov 21, 8:11 AM ET, by Bill Luby

You can always tell when the crowd gets long the VIX and ends up on ...

Emini Plays Again at the Highs Nov 18
Fri, Nov 18, 1:11 PM ET, by Corey Rosenbloom

Will it – or won’t it – break through to new highs? Or will we ...

From Speculative Start to Crushing Collapse in DRYS
Thu, Nov 17, 2:41 PM ET, by Corey Rosenbloom

Well that was exciting while it lasted – and it didn’t last long. Shares in ...

Straight Back to the Highs Nov 17 Emini Update
Thu, Nov 17, 2:21 PM ET, by Corey Rosenbloom

We’re back into the 2,180 prior high target and plotting our next move along with ...

Did You Ever Think Dry Could Go this High DRYS
Wed, Nov 16, 12:21 PM ET, by Corey Rosenbloom

The talk of the trading community this week is the impossible, raging rally in Dry ...

Coming Down from the Highs Emini Update Nov 16
Wed, Nov 16, 12:11 PM ET, by Corey Rosenbloom

Though not stellar so far, price is pulling down away from the 2,180 @ES pivot. ...

Might the Financial Stock Surge Stall Today after Huge Rally
Tue, Nov 15, 12:31 PM ET, by Corey Rosenbloom

After the surprise US Election outcome, we’re seeing a flood of money into Financials, presumably ...

Still Hanging Out at the Highs Emini Update Nov 15
Tue, Nov 15, 12:21 PM ET, by Corey Rosenbloom

We’re still seeing price trade at the highs after a sideways pullback instead of a ...

Radical Reversal for Dry Ships DRYS with Bullish Surge
Mon, Nov 14, 3:51 PM ET, by Corey Rosenbloom

It’s not often you see a stock go from beneath $5.00 to $40.00 in three ...

Range Trading at the Emini Highs November 14
Mon, Nov 14, 1:31 PM ET, by Corey Rosenbloom

Our divergences at the high continue to stall the market just ahead of a key ...

Ten Year Treasuries Return to Higher Timeframe Trendline
Fri, Nov 11, 3:11 PM ET, by Corey Rosenbloom

After Tuesday’s US Election, we’ve seen rapid movement in the intermarket landscape. Let’s focus on ...

Another Divergence Reversal at the Emini Highs Nov 11
Fri, Nov 11, 12:21 PM ET, by Corey Rosenbloom

A key pattern – with visual negative divergences – is forming at the retest highs. ...

Emini Divergent Reversal at the Highs Nov 10
Thu, Nov 10, 12:21 PM ET, by Corey Rosenbloom

Additional bullish price action after the election sent us to our prior high target into ...

LABU 3x Biotechs Surges with Bullish Reversal Breakout
Wed, Nov 9, 4:31 PM ET, by Corey Rosenbloom

Triple-Leveraged ETFs offer chances for instant profit – or loss – depending on the outcome. ...

With a Surprise Trump Triumph the Emini Surge Continues Nov 9
Wed, Nov 9, 12:11 PM ET, by Corey Rosenbloom

Markets like certainty – even if that certainty comes at a big surprise to most ...

Top VIX Crushes in History
Tue, Nov 8, 1:21 PM ET, by Bill Luby

Yesterday's sharp downward move in the VIX gave me a reason to tweet that the ...

The Emini Election Day Surge Simply Continues
Tue, Nov 8, 1:21 PM ET, by Corey Rosenbloom

It’s Election Day in the USA and the stock market rally continues in full force! ...

Four Rapid Money Flow Reversals before the Big Election
Mon, Nov 7, 3:41 PM ET, by Corey Rosenbloom

Before Americans go to the polls and select the next president, we’re seeing sudden reversals ...

SPX Sigma and Volatility Chart for November
Mon, Nov 7, 12:31 PM ET, by Corey Rosenbloom

Price cycles between alternating periods of high and low volatility, and if we can assess ...

The Nov 7 Expected Emini Bounce Surges Higher
Mon, Nov 7, 12:11 PM ET, by Corey Rosenbloom

Here we go – after a pullback exactly to our 2,080 target, buyers continued expected ...

The Nov 6 Expected Emini Bounce Surges Higher
Mon, Nov 7, 11:51 AM ET, by Corey Rosenbloom

Here we go – after a pullback exactly to our 2,080 target, buyers continued expected ...

VIX Sets New Record with Nine Up Days in a Row
Mon, Nov 7, 8:11 AM ET, by Bill Luby

Over the course of the past few days I have been tracking the slow grind ...

How to Play a Volatility Spike (Guest Columnist at Barron's)
Sun, Nov 6, 6:11 PM ET, by Bill Luby

Yesterday, I was pleased to once again have an opportunity to pen a guest column ...

The Expected Emini Bounce Materalizes Today
Fri, Nov 4, 1:21 PM ET, by Corey Rosenbloom

Here we go – after a pullback exactly to our 2,080 target, buyers are creating ...

The Dreaded Divergence and Three Push Precede Facebook Fall
Thu, Nov 3, 12:11 PM ET, by Corey Rosenbloom

Price often gives visual signals before reversing, even if in real-time it looks very surprising. ...

VIX Median Reversion and Five-Year Moving Averages
Wed, Nov 2, 1:51 PM ET, by Bill Luby

When people talk about the VIX you often hear them refer to mean reversion, which ...

A Quick Lesson in Divergent Reversals for the US Dollar
Tue, Nov 1, 12:11 PM ET, by Corey Rosenbloom

Many traders love reversal patterns but so many traders get trapped in false reversals in ...

Updating Apple AAPL into Critical Target Support
Tue, Nov 1, 11:51 AM ET, by Corey Rosenbloom

Will Apple (AAPL) shares hold support at the current pivot or will sellers break price ...

Down to the Lows You Go Emini Morning Update Nov 1
Tue, Nov 1, 11:31 AM ET, by Corey Rosenbloom

We continue using our key Fibonacci Grid for the Emini, but we may see a ...

Down Goes Crude Oil on a Mirror Image Rounded Reversal
Mon, Oct 31, 1:11 PM ET, by Corey Rosenbloom

The “Rounded Reversal” or “Mirror Image Foldback” is one of my favorite chart patterns yet ...

Halloween Emini Fibonacci Grid Daily Update
Mon, Oct 31, 12:51 PM ET, by Corey Rosenbloom

You’re truly missing out if you’re not bookmarking and following our morning Emini Fibonacci Grid. ...

Take a Look at that Emini Fibonacci Reversal Today Oct 27
Thu, Oct 27, 12:41 PM ET, by Corey Rosenbloom

You’re truly missing out if you’re not bookmarking and following our morning Emini Fibonacci Grid. ...

Chipotle CMG Collapses Through Support to New Lows
Wed, Oct 26, 1:41 PM ET, by Corey Rosenbloom

Chipotle (CMG) reminds us exactly why WE DO NOT fight or fade a trend in ...

Gapping and Reversing and Trading our Emini Fibonacci Grid Oct 26
Wed, Oct 26, 11:31 AM ET, by Corey Rosenbloom

You’re truly missing out if you’re not bookmarking and following our morning Emini Fibonacci Grid. ...

Gapping Into and Reversing Away From our Emini Fib Grid
Mon, Oct 24, 1:11 PM ET, by Corey Rosenbloom

You’re truly missing out if you’re not bookmarking and following our morning Emini Fibonacci Grid. ...

Still Bouncing Between our Key Emini Fibs Oct 21
Fri, Oct 21, 1:41 PM ET, by Corey Rosenbloom

You’re truly missing out if you’re not bookmarking and following our morning Emini Fibonacci Grid. ...

Trading Between our Two Emini Fibonacci Levels Oct 20
Thu, Oct 20, 1:41 PM ET, by Corey Rosenbloom

You’re truly missing out if you’re not bookmarking and following our morning Emini Fibonacci Grid. ...

  More articles:  1 2 3 4 5 6 7 next »

ABOUT US »   ADVERTISE »   CONTACT US »   TERMS OF USE & PRIVACY POLICY »

Charting the SP500 Outcome of Elections Past | Self Directed Investor | Copyright © 2008 - 2016, All Rights Reserved

Any ideas and opinions presented in Self Directed Investor content are for informational and educational purposes only, and do not reflect the opinions of BNK Invest, Inc. or any of its affiliates, subsidiaries or partners. In no way should any content contained herein be interpreted to represent trading or investment advice. None of the information contained herein constitutes a recommendation that any particular security, portfolio, transaction, or investment strategy is suitable for any specific person. All site visitors agree that under no circumstances will BNK Invest, Inc,. its subsidiaries, partners, officers, employees, affiliates, or agents be held liable for any loss or damage caused by your reliance on information obtained. Read Full Disclaimer.

SDI is associated with: ValueForum.com -- a subscription-based online social networking forum of serious individual investors. | MarketNewsVideo.com -- videos appearing on SDI are produced by Market News Video. | TickerTech.com -- stock quote content appearing on SDI is at least 20 minutes delayed and is powered by Ticker Technologies. | GoldStockStrategist.com -- Edited by Scott V. Nystrom, PhD, Gold Stock Strategist provides analysis on gold mining companies.