Just when cryptocurrencies offered a glimmer of hope, the group has fallen right back to where it started. Following a 54% decline from 2025 highs for the Hashdex Nasdaq CME Crypto Index US ETF (NCIQ), a broad basket of liquid cryptocurrencies, it looked like the group was starting to turn a corner. After completing its final sell signal in February, five of the next six breaks for NCIQ were buy signals, during which it gained nearly 30% from its lows. Unfortunately, the rally didn’t last. The fund broke a triple bottom two weeks ago and has plunged lower since then, with intraday action on Thursday crossing below its February low. Consequently, the fund has moved back into a negative trend, in addition to losing its near-term market relative strength. Given the group’s lack of strength, as evidenced by NCIQ’s 0.16 fund score, the cryptocurrency space remains unfavored. Granted, both the index and individual names trade in heavily oversold territory, so it could hold steady for the next couple of weeks

During the previous decline from October to February, Bitcoin ($BTC) held up better than altcoins such as Ethereum ($ETH). This time around, however, even Bitcoin has erased all its progress over the last several months. Bitcoin reversed into a column of Os on its default chart after crossing $63k, taking it below levels initially reached in 2021. From here, initial support lies around $60k, with additional support around $55k and $50k. As we mentioned in yesterday’s report, the iShares Bitcoin Trust ETF (IBIT) also moved back into a negative trend to start the month, with it now holding an extremely weak fund score of 0.17—albeit while also trading in heavily oversold territory in the near-term.

The pullback within cryptocurrencies also led to change in one of the most notable indicators we track. Bitcoin is now failing its “Bogey Check,” reversing back into a column of Os versus cash (MNYMKT), indicating that Bitcoin investors have seen a flight to safety. Most of Bitcoin’s gains have come while the coin has passed its bogey check, serving as another sign of caution.

Previous research into Bitcoin bottoms explored what happened to the cryptocurrency following the instances when it fell more than 50%. One of the major themes was that Bitcoin tends to see an initial bounce following those occasions before reversing lower on average, mirroring recent action. Specifically, Bitcoin saw a positive median return through three months but was negative 83% of the time after a year, declining by 19% on average. This time around, Bitcoin was up as much as 29% three months after initially being cut in half but is now only 1% away from its February 5th level. With Bitcoin’s breakout failing dramatically, it would need to see significant and consistent improvement before it returns to technical favor, so investors are likely best off avoiding it for the time being. That said, things change quickly in the world of crypto, making it all the more important to follow movement for signs of a rebound. 

Although summer doesn’t officially begin for about another two weeks, many Americans recognize Memorial Day as the unofficial start of summer. Many of us are looking forward to the warm weather, beach vacations, and the other usual summer activities. However, in the investment world, the summer months are associated with lackluster returns, also known as the "Summertime Blues." This year, we enter the summer months after what has been a strong, if rocky, start to the year. The market has rebounded spectacularly from the Q1 pullback and the S&P 500 (SPX) is up more than 10% for the year (through 6/3).

The table below shows the returns of both the Dow Jones Industrial Average (.DJIA) and the S&P 500 during the summer months (May 31st to August 31st) since 1981. The S&P 500 and the Dow Jones Industrial Average have each finished in negative territory in 16 of the past 45 summers (or about 36% of the time). Of those 16 down summers, there were 14 summers in which SPX and DJIA were both down at the same time. While less than half of the summers have been negative for these benchmarks, the bad summers were indeed bad, with some down double digits over the three-month period. For instance, in the summer of 1990, SPX fell -10.69%. In 1998, it saw a drop of -12.24%, but the worst summer came in 2002 during the tech crash when the index declined -14.16%. During the summer of 2008, which began a famously longer slide as SPX fell -8.39%. The market has bucked the trend recently, as the Dow and the S&P have each had only one negative summer (2022) since 2015 and both indices have averaged gains of more than 7% over the last three summers.

To determine if there is one month that tends to have an outsized effect on summer returns, we compiled a monthly summary of S&P 500 returns going back to 1958. What we found is that the summer months tend to have a lower median return than most of the other months of the year. It is the month of September that has historically provided the lowest median return at -0.42%, but it is followed by June which has a median return of just 0.16%. Notice too that the spread, i.e., the max return in each month versus the minimum return in a given month, is relatively low for the summer months (namely June and July).  A closer look at the month of June reveals a max return of 6.89% in the last 60 years, which it posted in 2019, and which followed a May return of -6.58%. Every other month, except February, had a maximum return of more than 8%. Clearly, June has historically been one of the weaker months for SPX returns. However, we can't blame the Summertime Blues on June alone. August has experienced the second-largest drawdown (after October) at -14.56%, which compares unfavorably to the other months' largest drawdowns.

To take this concept one step further, we looked at four hypothetical portfolios specific to each of the four seasons. Defined as follows:

Winter Portfolio Dates: 11/30 - 2/28

Spring Portfolio Dates: 2/28 - 5/31

Summer Portfolio Dates: 5/31 - 8/31

Fall Portfolio Dates: 8/31 – 11/30

The end result? The summer portfolio greatly underperformed the other three seasons - fall, winter, and spring.  If you were to invest only during the spring months (March through May), the initial investment would have had a cumulative return of over 500% from 1958 through May 2026 with an average return of more than 7%, making it the best performing seasonal portfolio. The winter portfolio deserves an honorable mention because it produced a gain of over 350% during the study period. The point of the graph below is to show that the summer months paled in comparison to the others, gaining just 118% since 1958 - that results in an average return of only 1.7%.

As discussed above, summer has been much kinder to investors over the last 10 years or so, and you can see that the summer line on the seasonal growth chart above has turned upward. Still over the very long-term, average returns have been noticeably higher during the other seasons. What summer has in store for the market this year remains to be seen. Last year, stocks recovered from a March/April swoon and the S&P went on to gain more than 9% during the summer. This year, we once again had a pullback in the spring months, but as we enter the summer months the market has already exceeded its prior high by roughly 8% and is now pushing into extended territory.

Call

Linde PLC (LIN) Sep 15 $500 Call

Additional Data: 

Bid/Ask Spread: 9.87%

Delta: 59.64

Gamma: 0.57

Implied Volatility: 25.70%

Expiry Days: 106

Earnings Date: 7/31/2026
 

Put

Meta Platform (META) Aug 21 $630 Put

Additional Data: 

Bid/Ask Spread: 2.08%

Delta: -45.86

Gamma: 0.35

Implied Volatility: 38.58%

Expiry Days: 78

Earnings Date: 7/29/2026

Income (Covered Call)

FedEx (FDX) Sep 18 $450 Covered Call

Additional Data: 

Ann. Static Return: 19.58%

Bid/Ask Spread: 23.33%

Delta: 73.22

Gamma: -0.27

Implied Volatility: 22.83%

Expiry Days: 106

Earnings Date: 6/23/2026