Updated

Strategist Jim Paulsen highlighted a lagged indicator suggesting that the typical November-through-April seasonal strength in equities may not materialize this year, diverging from the historical pattern of strong returns during that period. Paulsen's backtesting of the model to 1970 shows meager returns when the indicator signals weakness, suggesting potential headwinds for the traditional year-end and early-year rally season. The finding adds to existing technical concerns about market breadth and advance-decline ratios, though it conflicts with strategist views that many traditional recession warning signs remain absent from the current environment.