The January Barometer is summed up by an old Wall Street adage, "As goes January, so goes the year." Therefore if the stock market is up during the month of January, then the January Barometer dictates that the stock market should show a gain for the following 11 months.
The January Barometer does have a fairly successful track record. For example, from 1950 to 2003, the S&P 500 was up in January 34 times. In 30 of those 34 instances, the S&P 500 traded higher 11 months later. That equals a success rate of 88%.
For a detailed analysis of the January Barometer plus many other stock market anomalies and indicators, try Chart of the Day.
