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Once again we have the honor of introducing the Fifty-First Edition of the Stock Trader's Almanac. The Almanac provides you with the necessary tools to invest successfully in the twenty-first century.

J. P. Morgan's classic retort, “Stocks will fluctuate,” is often quoted with a wink-of-the-eye implication that the only prediction one can make about the stock market is that it will go up, down, or sideways. Many investors agree that no one ever really knows which way the market will move. Nothing could be further from the truth.

We discovered that while stocks do indeed fluctuate, they do so in well-defined, often predictable patterns. These patterns recur too frequently to be the result of chance or coincidence. How else do we explain that since 1950 all the gains in the market were made during November through April, compared to a loss May through October? (See page 50.)

The Almanac is a practical investment tool. It alerts you to those little-known market patterns and tendencies on which shrewd professionals enhance profit potential. You will be able to forecast market trends with accuracy and confidence when you use the Almanac to help you understand:

■ How our presidential elections affect the economy and the stock market – just as the moon affects the tides. Many investors have made fortunes following the political cycle. You can be sure that money managers who control billions of dollars are also political cycle watchers. Astute people do not ignore a pattern that has been working effectively throughout most of our economic history.

■ How the passage of the Twentieth Amendment to the Constitution fathered the January Barometer. This barometer has an outstanding record for predicting the general course of the stock market each year, with only nine major errors since 1950, for an 86.6 % accuracy ratio. (See page 16.)

■ Why there is a significant market bias at certain times of the day, week, month, and year.

Even if you are an investor who pays scant attention to cycles, indicators, and patterns, your investment survival could hinge on your interpretation of one of the recurring patterns found within these pages. One of the most intriguing and important patterns is the symbiotic relationship between Washington and Wall Street. Aside from the potential profitability in seasonal patterns, there's the pure joy of seeing the market very often do just what you expected.

The Stock Trader's Almanac is also an organizer. Its wealth of information is presented on a calendar basis. The Almanac puts investing in a business framework and makes investing easier because it:

■ Updates investment knowledge and informs you of new techniques and tools.

■ Is a monthly reminder and refresher course.

■ Alerts you to both seasonal opportunities and dangers.

■ Furnishes a historical viewpoint by providing pertinent statistics on past market performance.

■ Supplies forms necessary for portfolio planning, record keeping, and tax preparation.

Also, to give you even greater perspective, we have listed next to the date of every day that the market is open the Market Probability numbers for the same 21-year period for the Dow (D), S&P 500 (S), and NASDAQ (N). You will see a “D,” “S,” and “N” followed by a number signifying the actual Market Probability number for that trading day, based on the recent 21-year period. On pages 121–128, you will find complete Market Probability Calendars, both long-term and 21-year for the Dow, S&P, and NASDAQ, as well as for the Russell 1000 and Russell 2000 indices.

Other seasonalities near the ends, beginnings, and middles of months – options expirations, around holidays, and other significant times – as well as all FOMC Meeting dates are noted for Almanac investors' convenience on the weekly planner pages. All other important economic releases are provided in the Strategy Calendar every month in our e-newsletter, Almanac Investor, available at our website, www.stocktradersalmanac.com.

One-year seasonal pattern charts for Dow, S&P 500, NASDAQ, Russell 1000, and Russell 2000 appear on pages 171 to 173. There are three charts each for Dow and S&P 500 spanning our entire database starting in 1901 and one each for the younger indices. As 2018 is a midterm election year, each chart contains typical midterm year performance compared to all years.

The Notable Events on page 6 provides a handy list of major events of the past year that can be helpful when evaluating things that may have moved the market. Over the past few years, our research had been restructured to flow better with the rhythm of the year. This has also allowed us more room for added data. Again, we have included historical data on the Russell 1000 and Russell 2000 indices. The Russell 2K is an excellent proxy for small and mid-caps, which we have used over the years, and the Russell 1K provides a broader view of large caps. Annual highs and lows for all five indices covered in the Almanac appear on pages 149–151, and we've tweaked the Best & Worst section.

In order to cram in all this material, some of our Record Keeping section was cut. We have converted many of these paper forms into computer spreadsheets for our own internal use. As a service to our faithful readers, we are making these forms available at our website, www.stocktradersalmanac.com.

Midterm election years have been the second worst year of the four-year cycle, while eighth years of decades have been the second best, so 2018 promises to be laced with crosscurrents. The last nine eighth years of decades appear on page 24. You can find all the market charts of midterm elections since the Depression on page 26, “Midterm Election Years: Where Bottom Pickers Find Paradise” on page 30, “Prosperity More Than Peace Determines the Outcome of Midterm Congressional Races” on page 32, and “Why a 50 % Dow Gain Is Possible From Its 2018 Low to Its 2019 High” on page 34.

Our “Super Boom Update: 2010 Forecast On Track for Dow 38820 By 2025” appears on page 40, followed by “Culturally Enabling Paradigm Shifting Technologies Poised to Fuel the Next Super Boom” on page 42. For the first time in the Almanac we show how “Summer Market Volume Doldrums Drives Worst Six Months” on page 42.

On page 76 is our Best Investment Book of the Year, Relationship Investing: Stock Market Therapy for Your Money, by Jeffrey S. Weiss, CMT (Skyhorse Publishing). Other top books are listed on page 116. Sector seasonalities include several consistent shorting opportunities and appear on pages 92–96.

We are constantly searching for new insights and nuances about the stock market and welcome any suggestions from our readers.

Have a healthy and prosperous 2018!

NOTABLE EVENTS

2016

2017

2018 OUTLOOK

It's like déjà vu all over again. A new president is getting challenged from all angles on many fronts and having a difficult time implementing his agenda. However, for the first half of 2017 the market has rallied smartly on the promise of change, tax and healthcare reform, deregulation and a massive infrastructure buildout – but mostly on the fact that election uncertainty is over and nothing is happening in DC. So far little has been accomplished and although new highs have just been logged as of this writing, little ground has been gained since March 1.