Here’s How To Beat The “September Slump”  

By Mike Burnick

We’re coming up on a spooky season for investors. Even Mark Twain, way back in 1894, wrote: “October. This is one of the peculiarly dangerous months to speculate in stocks.” 

Of course, he then added that “The others are July, January, September, April, November, May, March, June, December, August, and February.” 

And, in fact, today we know from decades of hard data that September, not October, is statistically the worst month for the stock market. 

Let’s briefly review September’s track record – and then see how to trade the trend for potential profits! 

Turn the September Slump Into Opportunity 

As you can see below, our Trade Cycles Seasonality chart for the S&P 500 shows the path of least resistance is down for stocks in September.  

Since 1950, the index has risen just over 50% of the time while posting negative average returns. 

It’s worth noting that historically, the worst of the seasonal decline starts around mid-month, before prices continue lower into October – just as Twain observed. 

With the S&P 500 near all-time highs, a September pullback could be a good opportunity to buy the dip. 

Whatever September and October has in store, though, Signals by TradeSmith is a cutting-edge trading system designed specifically to help you buy the dip with confidence, much like the hedge funds do. 

Every single trading day, Signals analyzes every stock in the S&P 500, looking for unique trading signals. 

A signal is simply a pattern that has shown up many times before in a given stock. When this unique set of conditions aligns, that stock tends to move up or down in a consistent, predictable manner.  

Signals flags those patterns so you can trade them with the odds stacked in your favor, giving you a valuable edge. 

Subscribers can access these Signals, updated daily, by clicking on Signals from the main TradeSmith Finance page. 

This page is our Signals command center. Every trading day, I check to see what actionable trade Signals are active on specific stocks. Let’s take a closer look. 

The first tab shows you the Top 20 Signals – the highest-quality setups available today, ranked by our system. The data columns give you the vital information you need to evaluate each potential Signal trade: 

Please Note: If you don’t see this in your TradeSmith Finance dashboard, and would like to, please call our dedicated Customer Care team at 866-220-1107 to find out how to get access.   

How to Evaluate Signals for Potential Trades 

Most of the data columns are fairly self-explanatory. But let’s dig deeper into one of these trade ideas, and I’ll show you step by step what I look for in a potential trade. 

Simply click on any symbol in the list to open the Signals page for that stock. Let’s take Rubrik (RBRK), #1 on the Top Signals list, as an example. 

RBRK has flashed 113 Signals over the past five years – and for my money, the more Signals, the better conviction I have in a trade: 

And these Signals have been consistently profitable in the past, as you can see above.  

Here are the key stats on the past Signals for RBRK that you should consider: 

  • Quality Score: 96.93 
  • Accuracy Rate: 86.73%  
  • Average Return: +4.17% 
  • Median Gain: +4.26% (So, you can figure this is a typical return.) 
  • Max Win: +23.94% vs. Max Loss -14.86% 
  • Reward-to-Risk Ratio: 6.74 to 1  
  • Average Hold Time: 6 days 

Here’s what stands out the most for me about RBRK Signals are the Quality Score, the Accuracy Rate, and the Reward-to-Risk Ratio. 

  • The Quality Score factors in the average gain vs. loss, the number of previous signals, and the risks. Think of it as a report card for the signal’s track record: the higher the score, the better the signal. RBRK has been a straight-A+ stock, scoring 96.93. 
  • The Accuracy Rate tells you the percentage of past signals that closed with a gain. Again, for RBRK it’s very high, at 86.73% 
  • The Reward-to-Risk Ratio shows how the typical win compares to the typical loss historically. At 6.74-to-1, RBRK Signals delivered a win nearly seven times more than a loss. 

Similarly, the Max Win from past signals at +23.9% is much greater than the Max Loss of -14.86% 

That makes this Signals trade well worth consideration in my book. 

This is Where Buying-The-Dip Comes In 

As you can see above, RBRK has a Bullish outlook, and the trade category is Pivot. 

The Bullish Pivot signal looks for stocks that have moved too far, too fast in either direction – in this case, down – and are set to “pivot” in the other direction. Think of a rubber band stretched tight: the further it stretches, the faster it snaps back.  

Pivot signals aim to profit from the snapback, which is what typically happens after a market pullback. 

Now, let’s scroll down the page. Just below these vital stats, you’ll find:  

Past Signal Occurrences  

This shows you how many times this exact signal has appeared in the historical data. 

You can filter by the last one, five, or 10 years and see individual trade outcomes, the best and worst price movements, and how long trades typically lasted. 

More past signal occurrences mean more data to draw conclusions from.  

A signal that’s appeared over 100 times, like RBRK’s, may give you more confidence in its historical accuracy than one that’s appeared only 15 or 20 times. 

If you hover over the Chart column for any previous Signal, you’ll see a pop-up chart showing how that trade progressed from entry and exit, including the return (13.66%) and the time held (6 days). 

To the left, you’ll find a Scatter Plot of past Signal trades for the stock. At a glance, you can see patterns of past performance, both winning and losing trades. Hover over any dot to see the details of that trade. 

Here’s how you can use this data to better evaluate your trade.  

Notice how most of RBRK’s past signals sit above the zero line, with many of them substantial winners. 

You can see a cluster of winning trades at the left of the scatter plot in 2025. And recently, RBRK is again on a winning streak, with clusters of wins this year as well.  

There were few negative trades historically. That’s the kind of consistency I look for when considering a Signals trade. 

Just below this section you’ll find: 

Signals Event Path 

This shows the average price performance of all past Signals trades historically, by date.  

For RBRK, it has typically been a steady, consistent rise in price, which picks up between day 9 and day 15.  

Mike Burnick’s Bottom Line: When the stock market gives you an opportunity to buy-the-dip, which it appears to be now, I take a closer look at Signals by TradeSmith for specific trade ideas that may be poised for a rebound. Keep in mind that a signal isn’t a prediction. It’s a statistical probability that tells you what’s usually happens under similar conditions, not what will definitely happen now. But the proof is in the past performance: in six years of backtesting, a model portfolio of Signals trades delivered a 12X return. That can give you a significant statistical edge for your trades. 

Good investing,  

Mike Burnick 
Senior Analyst, TradeSmith 

P.S. Seasonality can tell you when a sector may turn – but knowing how to trade that turn is another skill entirely. Signals by TradeSmith is one way to do it – plus our Delta Report is lining up a bunch of new opportunities for you right now. 

Jeff Clark, Senior Analyst behind Delta Report, has traded options for a living his entire career, believes today’s volatility is the perfect setup for the right options strategy. It’s the idea behind his 12 Trades to $1 Million Challenge, an ambitious plan to help readers try to turn a $5,000 stake into $1 million or more in just 12 trades. 

And the early results speak for themselves: three winners already, at 166%, 153%, and 91%, with his long options winners averaging +76.2% each.  

For a limited time, we’re re-opening the doors with a special offer to support Jeff’s bold thesis that buy-and-hold is dead – it’s options’ time to shine. And since he’s about to drop his next recommendation at any moment, you could be off to the races before you know it. But you’ll need to claim your place before midnight on Tuesday, Sept. 15.  

Click here to see how you can still get in and take full advantage of his Challenge today.