{"id":24675,"date":"2025-07-30T07:30:00","date_gmt":"2025-07-30T11:30:00","guid":{"rendered":"https:\/\/jeffclarktrader.com\/market-minute\/?p=24675"},"modified":"2025-07-29T11:17:12","modified_gmt":"2025-07-29T15:17:12","slug":"the-melt-up-is-fading-history-says-theres-a-way-out","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/the-melt-up-is-fading-history-says-theres-a-way-out\/","title":{"rendered":"The Melt Up Is Fading \u2013 History Says There\u2019s a Way Out"},"content":{"rendered":"
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Managing Editor’s Note: <\/strong>According to TradeSmith CEO Keith Kaplan, today – July 30 – marks a major seasonal turning point, based on more than three decades of market data.<\/p>\n

Keith’s Trade Cycles <\/em>system is designed to identify these inflection points before they happen and pinpoint the exact stocks most likely to move.<\/p>\n

But here’s the thing… this signal may be even more important, especially for investors who want to sidestep the volatility that tends to blindside buy-and-hold portfolios at this time of year.<\/p>\n

Keith walked through the data – and revealed his full calendar of “green zone” trades – in a powerful event earlier this week. If you missed it, today’s the last day to catch the replay.<\/a> <\/p>\n<\/div>\n

The Melt Up Is Fading – History Says There’s a Way Out   <\/h2>\n

BY KEITH KAPLAN, CEO, TRADESMITH<\/strong><\/p>\n

The market in on fire right now…<\/p>\n

Since the post Liberation Day bottom, on April 7, the S&P 500 is up 32.1%.<\/p>\n

That’s not normal.<\/p>\n

It’s three times<\/em> its average annual return of about 10%.<\/p>\n

And that just scratches the surface…<\/p>\n

The Dow is up 22.6%… The Nasdaq 100 is up 40.7%…  and AI leader Nvidia (NVDA) is up a whopping 101% – all in three and a half months.<\/p>\n

It reminds me of the market “melt up” we saw in 2021, during the COVID-19 pandemic: It doesn’t matter what you buy.<\/p>\n

Everything<\/em> seems to be going up.<\/p>\n

But the data we compile at TradeSmith has supported that. I’ve been bullish on the market ever since the S&P 500 had one of its “green days” (more on that below) on June 28.<\/p>\n

But as I warned in an urgent broadcast<\/a> last week, we’re likely to see the end to this melt up… and a sudden shift to lower prices.<\/p>\n

How do I know?<\/p>\n

It’s all thanks to a data analytics project my team and I at TradeSmith started working on in 2022 – a project that’s led to one of the most successful TradeSmith tools in our 20-year history.<\/p>\n

So, today, let’s look at what’s coming up for stocks in the next week. Then I’ll show you a bullish<\/em> trade for the summer that this tool is flagging… despite the bearish<\/em> turn for the market coming up fast.<\/p>\n

Hidden Patterns in the Market<\/h2>\n

As TradeSmith CEO, I run a team of top “quant” investors, data scientists, and computer programmers.<\/p>\n

And for the past three years, we’ve been developing software that can spot hidden seasonality patterns in the stock market.<\/p>\n

The basic idea is that certain price trends repeat year after year, regardless – not unlike the nature’s seasons.<\/p>\n

Stocks don’t have summers and winters exactly. But we’ve been able to identify consistent, repeating cycles in stocks, currencies, and even commodities like oil and soybeans.<\/p>\n

They’re occurring all the time, all through the year.<\/p>\n

These patterns are hard for humans to see. But our software reviews decades<\/em> of market history for thousands<\/em> of stocks, indexes, and commodities—to pinpoint the moments when prices tend to turn, down to the calendar day.<\/p>\n

And right now, it’s<\/strong> flagging a major regime change for the stock market – beginning today<\/a> – Wednesday, July 30.<\/strong><\/p>\n

Not a crash<\/em> – I’m NOT recommending you pull out of the market entirely.  But a change in market trend that could catch millions of investors unaware.<\/p>\n

That’s why on Tuesday, July 22, I hosted an online briefing<\/a> along with legendary quant investor Louis Navellier to get the word out to as many people as possible.<\/p>\n

You see, the SPDR S&P 500 ETF (SPY) has just exited one of its green seasonal windows when the index has historically risen, year after year.<\/p>\n\n

\"\"<\/figure>\n\n

The bullish window that just closed has delivered gains over 80% of the time, based on market data from the last three decades.<\/p>\n

And sure enough, since the “green day” on June 28, the S&P 500 has reached new all-time highs. It’s now up more than 30% from the April low, as I mentioned earlier.<\/p>\n

But see how the market has tended to stumble in the circled area above after that green seasonal window ends? We have gotten a top around July 28. Then the market has stumbled before bottoming out in October.<\/p>\n

Over the past 15 years, the S&P 500 has had an average return of -1.6%, falling as much as 15% during this window.<\/p>\n

That doesn’t mean we should sit on our hands for the next three months. Instead, we need to act quickly with our trades – and be open to alternatives.<\/p>\n

We don’t stop trading. We just have to trade smarter.<\/em><\/p>\n

Time to Follow the Gold Bugs<\/h2>\n

In times of sinking stocks, our Seasonality tool shows that gold tends to rise. This makes it a go-to trade during the late summer stock market slump.<\/p>\n

Here’s what our Seasonality tool forecasts for gold in the coming months. Gold has two green days coming up, back-to-back – starting right as the S&P 500 enters its bearish pivot point:<\/p>\n\n

\"\"<\/figure>\n\n

Over the last 15 years, gold prices have risen 80% of the time or more during these windows for an average return of 3.2% across both.<\/p>\n

If you could repeat that trade every six weeks, you’d have an annualized gain of roughly 33%. And that’s assuming you only saw the average<\/em> return. Often, gold gains even more.<\/p>\n

For instance, in 2020, gold rose 6.4% in just the first 15-day window.<\/p>\n

And in 2011, it gained 10.6% during this window. It then went on to rise another 7.3% after its second “green day.”<\/p>\n

Historically, this seasonal bullish period lines up neatly with buying patterns in India – the world’s top consumer of gold as of last year. It’s an ideal time for gold retailers to stock up ahead of the wedding and festival season there, which kicks off in October.<\/p>\n

A New “Rapid Fire” Trading Approach<\/h2>\n

This is just one example of the profit opportunities our Seasonality tool has uncovered.<\/p>\n

There are plenty more, hidden beneath the surface – in commodities, currencies, crypto, and stocks.<\/p>\n

That’s why I’m giving Market Minute <\/em>readers access to our seasonality charts to see what cycles are hiding in your favorite stocks. It’s already helping TradeSmith members prepare for pullbacks the market may throw at us in the coming weeks.<\/p>\n

We’ve found stocks that follow their seasonal trends so consistently that you could’ve traded them for three decades straight and ended up with an 83% success rate.<\/p>\n

And by leveraging the power of this tool through options, our subscribers have been able to close out the following gains in our model portfolio…<\/p>\n