Over the past 10 years, the S&P 500 has posted positive returns in the week before Memorial Day 80% of the time. The average gain on the S&P 500 ETF, the SPY, is 1.32%.
Even more interesting? The two weeks after the holiday show a continued bullish tilt—though the pace tends to slow as summer officially kicks off. The average gain has been 0.57% over the 10 days following the holiday. Of course, 2022 was an outlier and dragged the average down.
Part of this might be due to lighter volume, rebalancing flows, and the classic “buy before the summer slowdown” behavior. It’s not explosive, but it’s consistent enough to pay attention to.
In other words: the S&P doesn’t usually take a vacation until later in June.
The 29 days after Memorial Day have netted the index an average gain of 1.62% with an 80% accuracy over the last 10 years.
QQQ: Tech Stocks Love a Holiday
When you zoom in on sectors, tech often leads the way, with QQQ showing a similar (and sometimes stronger) upside bias around this stretch. It makes sense—tech tends to catch inflows ahead of slower summer news cycles, and Memorial Day sometimes acts like a soft reset before earnings quiet down.
Names like Microsoft, Apple, and Nvidia (yes, still) tend to hold up or grind higher. If you’re tracking seasonal setups, that quiet bid under tech can be an early signal that money is rotating toward safety and growth simultaneously.
Over the last ten years, the QQQs gained an average of 1.11% during the seven days after the holiday, with an 80% accuracy rate.
What About Volatility? And 0DTE Options?
Now here’s where things get interesting for our premium sellers.
The VIX historically drifts lower into Memorial Day, sometimes pushing multi-week lows as traders front-run the drop in realized volatility.
That pattern doesn’t always hold—but when it does, initiating new positions by selling options (especially short-dated ones) gets riskier, not safer, because premiums decrease and you’re not paid for your risk.
That means selling way out-of-the-money spreads—or scaling back size—might be a smarter move than going heavy. Especially if you see IV rank sinking and VIX hugging the lows.
And 0DTE? They’re still seeing wild intraday action, but the net move in the index tends to be tighter during holiday weeks. So if you’re selling zero-day options, you might consider early exits and tighter stops. It’s not about being afraid—it’s about knowing the tape gets thin, and sometimes sleepy.
So… What’s the Move?
If history’s any guide, the market likes to stay upright around Memorial Day, with tech leading and volatility sliding. That doesn’t mean you blindly sell puts—but it does suggest that selling premium on the call side (contraian), or setting up rangebound plays (like iron condors), could work—as long as you stay nimble.
You can stay with the trend and sell puts during this time, but just be aware that while the drop in premium can help your sold puts, it may skew your risk/reward ratios if you haven’t already initiated the trade.
📌 Bottom line: Seasonality favors bulls heading into and out of Memorial Day, especially in the S&P 500 and tech. But for options traders, low volatility is both a gift and a warning.
