The good news is:

• All of the major indices closed at all time highs last Thursday and all except the Nasdaq composite (OTC) closed at all time highs last Friday. 

 

The Negatives

The first chart covers the last 6 months showing the OTC in blue and a 10% trend (19 day EMA) of Nasdaq new highs (OTC NH) in green.  Dashed vertical lines have been drawn on the 1^st trading day of each month.  

OTC NH failed to confirm the OTC all time high last Thursday. 

 

The next chart is similar to the one above except it shows the S&P 500 (SPX) in red and OTC NH in green has been calculated with NYSE data.  

NY NH failed to confirm Friday’s all time SPX high.  

 

The Positives

The next chart covers the past 6 months showing the SPX in red and a 10% trend (19 day EMA) of NYSE new lows (NY NL) in blue.  NY NL has been plotted on an inverted Y axis so decreasing numbers of new lows move the indicator upward (up is good).  

NY NL; NYSE new lows remained at insignificant levels.

 

The next chart is similar to the one above except it shows the OTC in blue, and OTC NL, in brown, has been calculated with Nasdaq data.

Nasdaq new lows also remained at unthreatening levels.

 

The next chart covers the past 6 months showing the OTC in blue and a 40% trend (4 day EMA) of Nasdaq new highs divided by new highs + new lows (OTC HL Ratio), in red.  Dashed horizontal lines have been drawn at 10% levels for the indicator; the line is solid at the 50%, neutral level (equal numbers of new highs and new lows). 

OTC HL Ratio recovered finishing the week at a comfortable 80%. 

 

The next chart is similar to the one above except it shows the SPX in red and NY HL ratio, in blue, has been calculated with NYSE data.

NY HL ratio also recovered last week.

 

Seasonality

Next week includes the 5 trading days prior to the 2^nd Friday of October during the 1^st year of the Presidential Cycle. The tables below show the daily change, on a percentage basis, for that period.  

OTC data covers the period from 1963 to 2024 while SPX data runs from 1953 to 2024.  There are summaries for both the 1^st year of the Presidential Cycle and all years combined.  Prior to 1953 the market traded 6 days a week so that data has been ignored 

Seasonality for the coming week has been mixed.

 

Report for the week before the 2nd Friday of October.

The number following the year is the position in the Presidential Cycle. Daily returns from Monday to 2nd Friday.

OTC Presidential Year 1 (PY1)

 Year       Mon     Tue     Wed    Thur    Fri    Totals

 1965-1  -0.17%   0.30%   0.09%   0.21%   0.34%   0.77%

 1969-1  -0.13%   0.38%  -0.40%   0.14%  -0.20%  -0.21%

 1973-1   0.54%  -0.09%  -0.80%   1.24%   0.48%   1.37%

 1977-1   0.07%  -0.45%  -1.38%  -0.80%   0.02%  -2.55%

 1981-1   0.84%  -0.02%   1.57%   1.18%   0.14%   3.70%

 

 Avg      0.23%   0.02%  -0.18%   0.39%   0.15%   0.62%

 

 1985-1  -0.77%  -0.49%   0.48%   0.41%   0.84%   0.47%

 1989-1   0.43%  -0.33%  -0.41%   0.01%  -3.09%  -3.39%

 1993-1   0.21%  -0.34%   0.33%  -0.30%   0.23%   0.14%

 1997-1   0.35%   0.89%   0.26%   0.23%  -0.39%   1.34%

 2001-1   0.04%  -2.23%   3.57%   4.62%   0.11%   6.12%

 

 Avg      0.05%  -0.50%   0.85%   0.99%  -0.46%   0.94%

 

 2005-1  -0.55%  -0.86%  -1.15%   0.48%   0.86%  -1.21%

 2009-1   0.98%   1.71%   0.32%   0.64%   0.72%   4.38%

 2013-1  -0.98%  -2.00%  -0.46%   2.26%   0.83%  -0.36%

 2017-1  -0.16%   0.11%   0.25%  -0.18%   0.22%   0.24%

 2021-1  -2.14%   1.25%   0.47%   1.05%  -0.51%   0.13%

 

 Avg     -0.57%   0.04%  -0.11%   0.85%   0.42%   0.63%

 

OTC summary for PY1 1965 - 2021  

 Avg     -0.10%  -0.14%   0.18%   0.75%   0.04%   0.73%

 Win%       53%     40%     60%     80%     73%     67%

 

OTC summary for all years 1963 - 2024

 Avg     -0.06%  -0.34%  -0.03%   0.21%   0.44%   0.20%

 Win%       55%     47%     52%     66%     69%     56%

 

SPX PY1

 Year       Mon     Tue     Wed    Thur    Fri    Totals

 1953-1  -0.47%  -0.38%   0.81%   0.17%   0.17%   0.30%

 1957-1  -1.33%  -0.64%   0.10%  -2.45%  -0.05%  -4.38%

 1961-1  -0.04%   0.25%   0.09%  -0.01%  -0.18%   0.10%

 

 1965-1   0.20%   0.61%  -0.10%  -0.08%   0.42%   1.05%

 1969-1   0.18%  -0.29%  -0.45%   0.39%   0.57%   0.40%

 1973-1   0.35%  -0.09%  -0.83%   1.71%   0.32%   1.46%

 1977-1  -0.23%  -0.86%  -0.94%  -0.62%   0.11%  -2.53%

 1981-1   0.13%  -0.10%   1.61%   0.82%  -0.70%   1.75%

 

 Avg      0.13%  -0.15%  -0.14%   0.45%   0.14%   0.43%

 

 1985-1  -0.74%   0.00%   0.36%   0.14%   0.82%   0.58%

 1989-1   0.28%  -0.19%  -0.60%  -0.45%  -6.12%  -7.06%

 1993-1   0.01%  -0.03%  -0.10%  -0.34%   0.25%  -0.21%

 1997-1   0.79%   1.07%  -0.94%  -0.33%  -0.38%   0.22%

 2001-1  -0.83%  -0.54%   2.29%   1.52%  -0.53%   1.92%

 

 Avg     -0.10%   0.08%   0.20%   0.11%  -1.19%  -0.91%

 

 2005-1  -0.72%  -0.21%  -0.61%  -0.07%   0.83%  -0.78%

 2009-1   1.49%   1.37%   0.27%   0.75%   0.56%   4.44%

 2013-1  -0.85%  -1.23%   0.06%   2.18%   0.63%   0.79%

 2017-1  -0.18%   0.23%   0.18%  -0.17%   0.09%   0.15%

 2021-1  -1.30%   1.05%   0.41%   0.83%  -0.19%   0.80%

 

 Avg     -0.31%   0.24%   0.06%   0.70%   0.38%   1.08%

 

SPX summary for PY1 1953 - 2021 

 Avg     -0.18%   0.00%   0.09%   0.22%  -0.19%  -0.06%

 Win%       44%     35%     56%     50%     61%     72%

 

SPX summary for all years 1953 - 2024

 Avg      0.09%  -0.26%   0.14%  -0.05%   0.15%   0.07%

 Win%       52%     37%     52%     44%     57%     58%

 

Conclusion

The market continued hitting new all time highs, but with fewer issues participating.

The strongest sectors last week were Precious Metals (for the 6^th week) and Health care while the weakest were Energy and Banks.

I expect the major averages to be higher on Friday October 10 than they were on Friday October 3.

 

 

---

More By This Author:

Technical Market Report For September 27, 2025
Technical Market Report For September 20, 2025
Technical Market Report For Sept. 13, 2025