Wait 3 Weeks Before You Buy This Big Bank Stock VIEW IN BROWSER By Michael Salvatore, Editor, TradeSmith Daily In This Digest: New inflation numbers are in, and they are harsh… The Consumer Price Index for December rose 2.7% from a year ago. Optimists will point out that the annual pace of inflation isn’t up from November. And that’s true. But it isn’t down, either. It’s also still stubbornly higher than the Fed’s 2% inflation target. And if you’re fixing a car, eating out, or grilling a steak at home… you’re feeling the pinch even more. Over the past 12 months, beef prices were up 16%. The cost of car parts and repairs was up more than 5%. And restaurant prices were up nearly 4%. There’s also the rising cost of natural gas to contend with. It’s increased more than 11% versus a year ago. That’s a problem if you’re among the roughly 50% of Americans who heat their home with natural gas. It’s also a problem if you don’t. Natural gas is a major fuel for generating electricity in the U.S. When gas gets more expensive, power producers’ costs rise – and electricity rates often follow. And natural gas isn’t just a household fuel. It’s also a big input for businesses. When energy costs rise, companies often face higher bills to run equipment, heat buildings, and move goods. Over time, some of that gets passed along as higher prices – the kind of “everyday inflation” folks notice. | Recommended Link | | | | When markets plummeted 24% in 2020, most investors panicked. Those with this mathematical system could have stayed calm and protected. More recently, one member across our services wrote in to say: “I got out of any stock that went into the red zone… Slept well every night,” says Francis R. Now it’s helping to protect thousands against the next inevitable crash. Click here to see how. |  | | Investors tend to obsess about government data releases like this… And that makes sense. These numbers get splashy headlines and endless hot takes on social media. But that makes them next to useless if you’re looking for an edge as an investor. Why? Because when everyone is staring at the same data at the same time… nobody has an edge. If you’re hunting for an advantage, you’re better off focusing on something most investors ignore – something that goes beyond the headlines that everyone else is reading. One example is seasonality: looking back at a stock’s history to find seasonal windows that have been consistently good (or bad) times to own that stock. It’s not a crystal ball. But it can highlight times when the odds have historically tilted one way. The more data you have, the clearer the picture becomes. That’s why our system combs through more than 2 quintillion (more than 2 million trillion) data points. We’re talking about decades of market history. It’s about as far from following news headlines as one can get. Instead, you pick from a treasure trove of similar setups in the past to stack the odds in your favor today. Today, I’ll show you what it says about the best months to buy and sell stocks in 2026. But first, let’s look at how seasonality works for individual stocks that are making headlines right now… First up is JPMorgan Chase, which has recently clashed with the White House… President Trump posted on social media last Friday that he intends to cap credit card interest rates to 10% for a year. And on Monday, credit card issuers American Express, Visa, and Mastercard all saw their share prices fall. Then yesterday, as part of the company’s earnings announcement, JPMorgan Chase CFO Jeremy Barnum, said “everything is on the table” to fight the measure. Investors – also factoring in a big miss on the bank’s loan underwriting fees – punished the stock with a 4.2% drop. That’s the news everyone has access to. But if you knew about seasonality, you wouldn’t be all that surprised about JPM’s price fall. Here’s the midterm-year seasonality chart for JPM over the past 10 midterm election year cycles – as long as we have data for the stock. Turns out, JPMorgan taking a bath during midterm-year Januarys is not unusual. In fact… it’s happened nine out of 10 times. 
The stock has been down in all but one of these seasonal windows. And on average, taking into account both gains and losses, it’s fallen by 6.2%. Looking through the lens of news headlines, it’s hard to figure out what’s in store for this stock. But looking through the lens of seasonality, a clear picture emerges. Over the past 10 midterm election years, JPM has staged a rebound starting around Feb. 5 and peaking on June 8. And it’s been positive eight out of the past 10 years for an average return of more than 9%. Next up is ExxonMobil, which is in hot water over Venezuela… At a White House meeting last week, ExxonMobil (XOM) CEO Darren Woods bluntly called Venezuela “uninvestable” in its current state. That was not the kind of support President Trump was looking for, and he threatened to cut Exxon out of any future Venezuela dealmaking. On Monday XOM fell more than 1%, then promptly rose again to an all-time high. If you’re like most folks reading the news, it’s hard to work out what any of that means for the stock. But if you’re looking at this price action through the lens of seasonality, you’ll know that the stock has historically seen some early-year volatility in mid-term election years: 
For this stock, we have data on 14 midterm election years. And going back to 1970, XOM has been negative 64.3% of the time from Jan. 13 to Feb. 17 of the midterm years. All in all, its average return is a 2% decline. XOM doesn’t see any strong midterm seasonal pattern until much later in the year. Between Oct. 14 and Nov. 9, it’s been higher all but one midterm election year – 1978 – and for an average return of 4.3%. We see a much clearer seasonal pattern with Netflix… The seasonal patterns for JPM and XOM are interesting but not hugely compelling as trades. That changes when we look at another stock that has been making headlines lately. For weeks now, streaming giant Netflix (NFLX) has been in a bidding war for Warner Bros. Discovery (WBD) with Paramount Skydance (PSKY). Yesterday, news broke that NFLX was considering an all-cash deal for WBD to sweeten the deal. NFLX investors haven’t seemed terribly excited about the acquisition. The stock is down 4% so far this year and almost 10% since the news originally broke on Dec. 5. But once again, all that headline buzz has nothing on the data. Take a look at our seasonality chart for NFLX. NFLX has only been around for the past six midterm election cycles. So let’s look at its more relevant 15-year seasonality data: 
From Jan. 12 to Feb. 18, NFLX has been up in all but two years – 2016 and 2022 – during this bullish seasonal window. And on average during this span, the stock has returned more than 21%. That’s more than double the average annual return of the S&P 500 for an entire year. What’s more, this stock just triggered our Seasonal Synergy signal. That happens when a stock is trading at its unique Optimal RSI level – meaning it’s oversold while entering a bullish seasonal zone. Like during last year’s bullish window – when NFLX shares rose more than 23% – this stock is shaping up to be a great trade today. Seasonality works over the long term, too… Here’s a monthly view of the S&P 500’s midterm election year pattern going back to 1954. As you can see, the S&P 500 has been negative in January more than half the time during midterm years. And its average return is a 1.7% decline: 
But look what happens after. The average returns rebound into March… only to crash again in June. Looking further out, we can see that stocks tend to surge in August… cool off in September… and see the best month of the year right after that in October. And thanks to new upgrades to our Seasonality software, we can now drill down to regular recurring patterns over individual days. This next chart shows us that for every calendar month of a midterm year, the bulk of the green days are at the start and midpoint of the month. 
This kind of granularity won’t be much use to long-term investors. But for traders, it’s another valuable layer of data to consider. At its core, TradeSmith’s seasonality tool is built to prepare you for anything and everything… That includes midterm election years, when politics get combative. Stocks surge – only to fall right back down… and the broad market often ends up lagging behind. Luckily, with that history as your guide, you can plan for all this in advance. And for the next six days, we’re inviting you to use our seasonality tool to build your own 2026 trading plan. This is a rare, free test drive of one of TradeSmith’s most popular features. Start yours now simply by signing up for next Tuesday’s Prediction 2026 event. At this free webinar, our CEO Keith Kaplan will share why the market could see a seismic move starting Jan. 20… Plus, you’ll learn all about TradeSmith’s newest rotation strategy – where you can jump from one battle-tested seasonal signal to the next, all year long. Click here for full details about our Prediction 2026 and get full access to our Seasonality tool until the event begins. To building wealth beyond measure, 
Michael Salvatore
Editor, TradeSmith Daily Disclosure: Michael Salvatore holds shares of JPMorgan (JPM) at the time of this writing. | 
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