"Year Ends In" Rule

The stock market is no mystery.  It does the same stuff over and over again.  There is a rule of decades that dictates that every year ending in a certain number acts like every other year ending in that same number.  For example, 2013 is behaving like 2003 and every other year that ends in "3."

Keep in mind that these are generalizations.  For example, years ending in 9 are supposed to be where the high is set for a bull market, seeing insane moves both up and down.  Well, in 2009 we saw insane up and down moves, but certainly did not hit any kind of bull market high due to the recession.  In fact we hit a bear market low in March 2009 and have been recovering since.

Year Ending in 0
Roaring bull market that may continue to hit highs.  Likely to develop a hard resistance that begins to kill the bull in the fall (around October).

Year Ending in 1
Typically a bear or bearish market.  Market will begin to slide off from the highs of the previous year and decline harder as the number of people experiencing larger losses increases.  After a small rally in the spring, the market slides as more people bail out of their stocks.  A pronounced late summer (usually August or September) slide should be expected, but is not guaranteed to happen.

Year Ending in 2
A bear market, market generally hits its lows in years ending in 2, and usually does so late in the year.  Generally flat to down with larger downside than upside moves.  Expect a sharper downside slide in the summer.  There will be a pop up after the summer low, followed by a decline.  Frequently hits its low in October or retests its summer low.  The fall low is typically the death of the bear.

Year Ending in 3
A baby bull market.  Previous year's lows will be frequently tested in the beginning of the year, generally by March/April.  The rest of the year is generally robust with an up-side bias.

Year Ending in 4
A sluggish bull market.  The market is digesting the gains seen in the last half of the previous year.  Generally a good year to the upside, but not as good as a year ending in "3."  A very good Fall/Winter move should be expected.

Year Ending in 5
A bull market.  Typically good, exceptional to the upside, especially in the Fall/Winter zone (October 25th - end of the year).  The early part of the year can have significant moves in either direction (up or down), but the Summer slide downward is less pronounced; it may only be slightly down or sideways.  The Summer time slide is seldom seen to the degree that it is in other years here.

Year Ending in 6:
A bull market.  Typically trading sideways to up as it digests the previous year's gains.  Good moves in both directions (up or down) are expected in the first half of the year.  Good moves to the upside are expected in the Fall/Winter zone (October 25th - end of the year).

Year Ending in 7:
A bull market that gets very choppy with large swings in both directions.  Expect a hard selloff, often considered a crash, or at least a severe correction.  The depth of the crash/selloff is a great place to buy stocks for the Vault, and is likely the low point for the next few years.  The decline can come at any time in the year, but is most likely to hit in September or October.

Year Ending in 8:
A bull market that simply continues the rise from last year that began after the big drop.  A year ending in 8 will have strong moves to the upside, followed by brief sideways moves to "digest" gains before continuing with more strong upside moves.  A sharp Summer decline is likely, and will usually be severe enough to scare a lot of people out of the market.  Following a September or October low, an EXTREMELY strong Fall/Winter zone (October 25th - end of the year) is typical.

Year Ending in 9:
Roaring bull market that generally sees it's high this year or next, with stocks seeing huge/crazy/insane moves in both upward and downward directions.  Basically this is a "strap on your helmet" year, because it's going to get nutty.