Over the last 20 years, the S&P 500 has formed a distinct pattern of strength from the final week of June through the third week of July. It’s one of the most reliable seasonal trends in the market—and this year, it’s getting a big boost from developments far beyond earnings and charts.
Tensions in the Middle East are easing. The Administration appears to be making progress on tariffs ahead of the July deadline. And now, with the S&P 500 breaking out to new all-time highs, another classic “fear of missing out” rally is already gaining momentum. Combine that with the historical seasonality, and the next few weeks could bring a sharp burst of upside.
Let’s take a closer look at the pattern—and how to trade it.
According to the last 20 years of weekly S&P 500 data, the weeks immediately following the end of June are some of the strongest of the year. The rally typically runs from week 26 through week 29, which aligns almost perfectly with the kickoff to earnings season.
This timing is anything but random. Earnings season reliably injects optimism, headlines, and buying pressure into the market, and investors tend to front-run those catalysts. As the large banks begin to report, followed by tech and consumer names in mid-July, this rhythm shows up clearly in the data.
Here’s the average performance by week (past 20 years):
In a typical year, this stretch contributes a meaningful portion of the market’s full-year return. But this year may not be typical—it may be stronger.
With geopolitical fears cooling and trade war anxieties easing, two of the biggest sentiment headwinds are diminishing. That opens the door for investors to start allocating risk again.
More importantly, the S&P 500 just made new all-time highs, which adds another layer of bullish psychology. Retail traders, institutional funds, and systematic strategies alike are wired to chase strength when resistance breaks. Momentum funds add fuel, and investors who’ve been on the sidelines are now looking for reentry. That’s textbook FOMO.
And it’s not just the S&P. The Nasdaq 100 (QQQ) has just broken out of a tight trading range, led by renewed strength in NVIDIA—setting the tone for risk assets heading into earnings season.
While late June through mid-July is a sweet spot for returns, the second half of the summer flips the script.
Starting in the last week of August, market seasonality turns sharply negative. August and September are historically the two worst-performing months of the year for the S&P 500, and the reasons are both psychological and structural.
Trading volume dries up. Headlines slow down. Earnings are behind us, and even the economic calendar gets light. Investors check out mentally—and that leaves the market vulnerable to even minor headlines or technical shifts. Volatility picks up, and there’s usually no buyer at the bid.
A bit of self-fulfilling behavior kicks in here too. Veteran investors know that these are dangerous months, so they start raising cash. That drains liquidity even more and sets up a potential retest of summer lows before the typical October breakout begins the year-end rally.
The S&P 500 and especially the Nasdaq 100 (QQQ) are leading. The Magnificent Seven are still dominating flows, and until Wall Street learns a new playbook, that trend will continue into earnings.
Earlier this year, we warned about Death Cross signals—bearish technical patterns where the 50-day moving average crosses below the 200-day. Now, the tone has flipped.
We’re seeing a growing list of Golden Cross setups across both large- and mid-cap names. These are early technical signs that trend reversals are underway, and in a seasonally bullish window, they often lead to outsized gains. Focus on stocks where price is breaking above resistance with strong volume. These are the leadership names that institutions are buying now.
You don’t have to exit early, but it’s smart to have a strategy in place. Start thinking about profit-taking, tightening stops, and rotating into defensive sectors like utilities or healthcare. The goal is to ride the rally, but not get caught when the music stops in August.
This rally may be led by the usual suspects, but the baton is slowly starting to pass. Over the next year, investors will begin rotating into a new set of leadership stocks—what I call the “Speculative Seven.” These are companies on the frontlines of innovation—quantum computing, nuclear energy, AI infrastructure, and vertical mobility.
They may not lead this current rally, but the groundwork is being laid. Pay attention to which of these speculative names are holding up well through earnings season. Those will be the early leaders of the next bull cycle.
The next three weeks are a gift. Historically strong, supported by macro momentum, and technically bullish across the major indices. But don’t mistake this for a new bull market—it’s a seasonal burst, not a structural shift.
Use it wisely. Get exposure now. Take profits by August. In other words, stay very nimble. At minimum, make certain that you have a plan to raise cash in August and September. That And stay focused on where the next leaders will come from once this short-term window closes.
