An update from 19 December introduced mid-term election-year seasonality and projected a peak around 18 April. The seasonality chart uses closing prices and shows relative price movement. It outlined dates due around 7 March (low), 11 March (high), 13 March (low), and a larger peak around 20 March. These dates were treated as approximate, within plus or minus 5 trading days.

How The Pattern Has Tracked So Far

So far, the index bottomed on a closing basis on 6 March and peaked on 9 March, then declined on 13 March. An up day on 13 March or early the next week was described as a way to confirm a trend change. A table compared key seasonal highs and lows with this year’s moves. Out of 11 major turning points, 8 matched closely and 3 did not, giving 73% alignment. The projected path was a bottom around 13 March, a rally to about 20 March, two weeks of decline, then a final rally into the 18 April high. This was also shown with an Elliott Wave count in a second figure. Last year, looking at the market in March 2025, we noted how well the S&P 500 was tracking mid-term election year seasonality. At that time, the pattern had aligned with actual market turns with about 73% accuracy. This historical tendency gave us a valuable roadmap for the market’s expected twists and turns. Here in March 2026, another mid-term election year, we are seeing a similar rhythm emerge. After a volatile start to the year, the market found a significant low in the final week of February before rallying strongly to a peak on March 10th. This recent pullback aligns with the expectation of a secondary low around the middle of the month, much like the pattern suggested last year.

Trading Plan For The Next Window

Recent economic data gives this view more credibility. The February 2026 Consumer Price Index came in slightly above expectations at 3.4%, causing the recent market dip and pushing the VIX volatility index back up to the 18 level. This suggests traders are nervous but are still looking for a reason to push prices higher, fitting the seasonal narrative. If this mid-term pattern continues to hold, we should anticipate the current weakness to be a buying opportunity. The roadmap suggests a bottom is forming right now, setting the stage for a rally into a peak around March 21st. Derivative traders should be preparing for this short-term upward move over the next week. For traders looking to capitalize on this, buying short-dated call options or establishing bullish call spreads on major indices with expirations in late March could be a prudent strategy. This approach allows for participation in the expected rally while clearly defining risk. The goal is to capture the potential upswing into that anticipated March 21st high. However, we must also look at what the pattern predicts next. Following the late-March peak, the seasonal model points to a roughly two-week decline into early April. Therefore, traders should be prepared to take profits on bullish positions and potentially initiate new bearish positions, such as buying April-expiration puts, to trade the subsequent downturn. This expected dip in early April could then present another opportunity for a final, more significant rally into the well-established mid-term year peak around April 19th. Vigilance is key as we monitor the price action to confirm the market is still following this historical path. We will anticipate these turns but stand ready to adjust if the market deviates. Create your live VT Markets account and start trading now.

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