The strategist suggests buying during the September stock price decline as the market heads towards its best three-month period of the year.

According to Ned Davis Research, the decline of the Nasdaq 100 and S&P 500 in September presents a buying opportunity.

NDR stated that the weak seasonal data and excessive pessimistic trend suggest a strong upward trend in the fourth quarter.

NDR sees no signs of a rapid bearish market, with profit revisions and economic indicators in the positive.

According to Ned Davis Research, the 6% decline in the Nasdaq 100 since early September and the 4% decline in the S&P 500 present an attractive buying opportunity for investors.

Considering the weak seasonal data, the research company mentioned in Friday's note that the weakness in stocks this month is higher than usual, but it also represents a significant opportunity as the market heads towards the best three months of the year.

"With the weakness in September tempering optimism and the sentiment indicators turning excessively pessimistic, stocks are likely to be supported by the seasonal trend in the fourth quarter, and there is a high probability of starting a sustained rise similar to the first quarter," said NDR strategist Tim Hayes.

He added, "When comparing the three-month declines, October to December was the strongest, while August to October was the weakest."

Based on NDR's internal data, Mr. Hayes feels reassured that the stock market, economy, and corporate earnings do not show signs of vulnerability to a rapid bear market decline like the one seen in 2022.

Analyst earnings revisions continue to trend upwards and historically act as leading indicators for corporate earnings.

Hayes explained, "As with the revisions, the economic performance is a leading indicator of profit growth and is currently supporting profit expectations. The possibility of an economic downturn has risen from the lowest levels in May and June, but the stock market has not moved out of bullish mode."

Overall, the current market decline is likely to be a commonplace adjustment, ultimately proving to be healthy for the sustained bullish market that began in October 2022.

Hayes stated, "The current instability is likely to prove to be mere volatility rather than a sign of a new bearish market. It should lead to buying opportunities within the ongoing bullish market, ahead of the new uptrend in the fourth quarter."