"Sell On Rosh Hashanah, Buy On Yom Kippur" is a popular Wall Street adage. In 2022, the strategy does not look great.

Sell On Rosh Hashanah: Rosh Hashanah marks the Jewish new year and is typically celebrated a week or so before Yom Kippur. Rosh Hashanah was Monday, Sept. 26. The SPDR S&P 500 ETF Trust (NYSE:SPY) opened around $366 and closed a few dollars lower that day.

On Wednesday, Oct. 5, the S&P 500-tracking ETF is trading at around $376, and you would have missed out on some gains by selling that day.

So, the first leg of the strategy, selling on Rosh Hashanah, did not work out.

Buy On Yom Kippur: Jewish people around the world are observing Yom Kippur, a somber day of atonement. Since 1950, October has historically been decent for stock returns and November has been great.

Yet this year there are many macro headwinds that are crippling the market. As of now, the Federal Reserve has maintained its hawkish stance, so an investor could assume somewhat muted returns in the interim.

The "Buy on Yom Kippur" advice will only work if economic data gives investors confidence the Federal Reserve does not need to continue to raise interest rates at the current pace.

Non-farm payrolls will be released Friday, which should be a strong indicator of whether the Fed's actions have indeed slowed down the labor market.

(If so, this will be good news for the stock market.)

In conclusion, the two-leg strategy of "Sell on Rosh Hashanah, Buy on Yom Kippur" is zero-for-one, as investors would have been better off holding or even buying on Rosh Hashanah.

The second leg, "Buy on Yom Kippur," remains to be seen. It will likely depend on the Fed's interest rate plans and macro outlook.

Photo: Odelia Cohen via Shutterstock