Market analysts, prognosticators and soothsayers have been looking at the month of January in an attempt to get a pulse for how the rest of the year will turn out. However, stock exchange traded fund investors should take this January’s performance with a grain of salt.

So goes January, so goes the year, according to the so-called January Barometer.

Over the past 11 times the S&P 500 increased more than 5% over the first month of the year, the overall market returned 24.3% on average, with gains ranging from 45% in 1954 to 2.03% in 1987, writes Jeff Cox for CNBC.

Looking at the January 5-Day Rule – an indication of the bullish or bearish nature for the rest of the year, 2013 could be shaping up for a bullish bias, with some calling for the SPX to end the year at 1,655, writes Billy Williams for Money Morning. The first five day’s performance has successfully called the S&P 500’s direction 33 out of 39 years where the condition was met.

However, while the S&P 500 may have posted gains of 5.3% this January, market observers are wary that the rest of the year won’t fall in line with the typical January barometer.

“We’ve got a lot of excessive bullish sentiment,” Jeff Hirsch, editor in chief at the Stock Trader’s Almanac, said in the CNBC article. “We are running into the typical seasonal behavior, with November, December and January up and the best six months doing well. My feeling is we have another 5 percent or so on the upside and then we will start to weaken.”

Specifically, Hirsch points to technical factors like the new high that have been hard to overcome and fundamental weaknesses in the U.S. and global economy.

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