According to analysts from Fundstrat and Bank of America, Wednesday (January 8) is the last day of the window for the first five trading days of 2025. If the S&P 500 Index can close above 5,881.63 points, it will send a bullish signal for the market throughout the year.

On Wednesday, the S&P 500 Index closed at 5,881.63 points.

This is known as the 'First 5 Trading Day Rule,' which is based on Historical Data analysis. This rule shows that when the S&P 500 achieves positive returns in the first five trading days of the year, there is a high probability of achieving stronger positive returns for the entire year.

Bank of America technical strategist Stephen Suttmeier stated in a report earlier this week, 'Using the price returns of the first five trading days in January as a barometer of market performance for the entire year can be seen as another form of the January Barometer.'

Historical Data supports the bullish signal.

Fundstrat co-founder Tom Lee analyzed Historical Data and found that since 1950, if the S&P 500 achieves positive returns in the first five trading days, the probability of a rise for the entire year reaches 82%, with an average ROI of 13%.

In contrast, if the S&P 500 declines in the first five trading days of the year, the average ROI for the entire year is only 3%, and the probability of an increase drops to 54%.

As of Tuesday (the fourth trading day), the S&P 500 closed at 5,909 points, with a year-to-date (YTD) increase of about 0.5%. Tom Lee pointed out that if the S&P 500 can expand its YTD gain to over 1% on Wednesday, this bullish signal will be even clearer.

Since 1950, when the S&P 500 rises more than 1% in the first five trading days of the year, there is an 83% probability that the year will end with a positive return, and the average ROI reaches 16%," Li stated.

January Barometer Rule: "The January trend determines the performance for the whole year."

The rule for the first five trading days is often used in conjunction with the "January Barometer." According to Bank of America’s Sathmeier, the pattern that "January's performance determines the year's performance" has historically been common.

"How January performs, so does the rest of the year," Sathmeier said. "The best scenario is when the S&P 500 has positive returns in both January and the first five trading days. This has happened 47 times since 1928."

In those 47 instances, the S&P 500 had an 83% probability of recording positive returns for the year, with an average return of about 15%.

Summary: The beginning of the year trend is crucial.

Historical Data indicates that the market performance at the beginning of the year is closely related to the overall performance for the year. Especially in a context where investors are sensitive to Federal Reserve policies and economic data, January's market signals may have a significant impact on the annual investment strategy.

For investors, whether the S&P 500 can break through and stabilize at 5,881.63 points will become a dividing line for bullish or bearish outlooks.