If there is one lesson that has been reinforced this year it has been to respect seasonality. Even though the market was very extended in January it did not turn down until seasonality turned down. The market was even more extended in April but did not turn down until Sell In May and Go Away came into effect. Today we are seeing a big turnaround just as the first of the month is ushered in.
There is no holy grail in investing and there are plenty of times when seasonality does not work. However, the way to make money in the long run is to play the odds and seasonality works more times than it does not. There are many factors to take into consideration when taking a position and seasonality should be one of them in short and medium term time frames.