After the October dip, stocks may be getting ready to rip.
The S&P 500 is staging a bit of a recovery after last week's plunge.
Instead of that swift decline being a reason for concern, a historical analysis of similar situations suggests that the next few months could be sweet indeed for the market. In short, not even October jitters are enough to prevent the historically strong months of November and December from turning positive performances.
In 11 past years, the S&P has hit a 12-month high in September before correcting at least 5 percent from that high at some point in October, according to Jason Goepfert of SentimenTrader. Goepfert went on to find that in the Novembers that followed, the S&P had a positive month in eight of 11 times. Even more impressive, the market was positive through December in 10 of 11 years, gaining at least 3 percent in each year besides the infamous 1929. (Historical data from the earlier 90-stock S&P index can be used to extrapolate S&P performance dating back before the creation of the S&P 500 in 1957.)