News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Bearish
Wall Street
Bearish
Gold
Mixed
GBP/USD
Bullish
USD/JPY
Bearish
More View more
Real Time News
  • Indices Update: As of 16:00, these are your best and worst performers based on the London trading schedule: Germany 30: -0.02% US 500: -0.09% Wall Street: -0.10% France 40: -0.13% FTSE 100: -0.16% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/W40Vx8cpJi
  • Get your Thursday market update from @DailyFX Chief Strategist @JohnKicklighter 👇. He covers the US Presidential debate and more! https://t.co/9s7A2Y7Az4
  • US Eight-Week Bills Draw 0.090% Primary Dealers Awarded: 49.6% Indirect Bidders Accepted: 39.6% Direct Bidders Accepted: 10.8% B/C Ratio: 3.51
  • If the market's speculative leaders and its once-leading speculative catalysts can't reinvigorate a well-established bull trend, something significant is anchoring us
  • curious to see the results on this poll 👇 https://t.co/Yd0YgmUky5
  • We are now less than two weeks away from the US Presidential Election 🇺🇸. What do you think the #FX market impact will be?
  • Pelosi says 'just about there' on relief deal - BBG
  • $CSX - the rail shipping company that I consider a good proxy to growth - managed announced its $5 billion share buyback last night, which is cat nip to stocks, and it too can't follow through on its opening gap
  • Tesla offered up an earnings beat last night and the speculative favorite that is up 412% (!) on the year is spinning its tires today in the aftermath
  • Forex Update: As of 14:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.19% 🇨🇦CAD: -0.03% 🇯🇵JPY: -0.21% 🇦🇺AUD: -0.26% 🇪🇺EUR: -0.34% 🇬🇧GBP: -0.52% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/UHRqYP6B9B
Dow Jones, Nasdaq 100, S&P 500 Forecast for the Month Ahead

Dow Jones, Nasdaq 100, S&P 500 Forecast for the Month Ahead

2020-09-30 20:00:00
Peter Hanks, Analyst
Share:

Dow Jones, Nasdaq 100, S&P 500 October Price Outlook:

Advertisement

Dow Jones, Nasdaq 100, S&P 500 Forecast for the Month Ahead

An expectedly volatile September saw the Dow Jones, Nasdaq 100 and S&P 500 fall from their August levels as volatility surged and election uncertainty grew. That said, September is historically a bearish month for equity markets and many investors were issuing caution as the summer doldrums drew to a close. Either way, price action in the final week of the month, and indeed of the third quarter, was encouraging, but does that suggest stocks will continue higher in October?

Stock Market Seasonality

Dow Jones, Nasdaq 100, S&P 500 Forecast for the Month Ahead

Source: Bloomberg, compiled by John Kicklighter

While it is difficult to say with any certainty, history suggests October is one of the better performing months of the year on average with the S&P 500 returning roughly 1% in the month over the last thirty years. That said, a historical review of the volatility index (VIX) reveals October has also been the most volatile month with an average VIX level of 22.5 since 1990. Still, past performance is hardly indicative of future results and each calendar year can have substantial outliers that buck the trend.

Traits of Successful Traders
Traits of Successful Traders
Recommended by Peter Hanks
Traits of Successful Traders
Get My Guide

That being said, the ingredients for a volatile October are certainly present. On the bullish side, analysts are hoping for a coronavirus vaccine that will expedite a return to normalcy while others cling to the chance of further stimulus packages. Conversely, many investors have become pessimistic regarding the post-covid economy – perhaps rightfully so as companies announce massive layoffs.

vix price chart

Further still, investors are already positioning for election related volatility, evidenced by VIX futures. Evidently, the story of the equity market is far from a fairytale and a seasonal rise in volatility will work to exacerbate price swings in either direction. Nevertheless, a commitment from the Fed to maintain low interest rates should provide a tailwind for equity valuations in the longer-term.

Equities Forecast
Equities Forecast
Recommended by Peter Hanks
Get Your Free Equities Forecast
Get My Guide

While the longer-term outlook unfolds, I believe the election will become an increasingly dominant theme to watch in the fourth quarter and further volatility seems likely. In the meantime, follow @PeterHanksFX on Twitter for updates and analysis.

--Written by Peter Hanks, Strategist for DailyFX.com

Contact and follow Peter on Twitter @PeterHanksFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES