Santa Rally, Year-end Rally, January Effect…
Despite the sense of the logic of not holding risky assets with high valuations going into the imminent Fed hikes, it is NOT enough rationale to go shorting this market. Bears have many head winds for the next few weeks – the Santa Rally, then the year-end rally, then the January effect.
While investors could be well advised to trim their holdings on rallies induced by these effects, bearish traders might need to wait these tides out to strike. A break of the all-time high appears likely within the next couple of weeks.
Positional Trading Models: After turning short on Friday, 12/17, our positional models are now turning to a neutral/indeterminate bias. The short term bias is for a move to the upside, but not strong/clear enough for an outright bullish bias.
Intraday/Aggressive Models indicate the trading plans below for today:
Trading Plans for THU 12/23:
Aggressive Intraday Models: For today, our aggressive intraday models indicate no clear trading plans, as they are in an indeterminate state. Merry Christmas/Happy Holidays everyone!
IMPORTANT RISK DISCLOSURES AND NOTICES – READ CAREFULLY:
(i) This article contains personal opinions of the author and is NOT representative of any organization(s) he may be affiliated with. This article is solely intended for informational and educational purposes only. It is NOT any specific advice or recommendation or solicitation to purchase or sell or cause any transaction in any specific investment instruments at any specific price levels, but it is a generic analysis of the instruments mentioned.
(ii) Do NOT make your financial investment or trading decisions based on this article; anyone doing so shall do so solely at their own risk. The author will NOT be responsible for any losses or loss of potential gains arising from any investments/trades made based on the opinions, forecasts or other information contained in this article.
(iii) Risk Warning: Investing, trading in S&P 500 Index – spot, futures, or options or in any other synthetic form – or its component stocks carries inherent risk of loss. Trading in leveraged instruments such as futures carries much higher risk of significant losses and you may lose more than you invested in them. Carefully consider your individual financial situation and investment objectives before investing in any financial instruments. If you are not a professional trader, consult a professional investment advisor before making your investment decisions.
(iv) Past performance: This article may contain references to past performance of hypothetical trades or past forecasts, which should NOT be taken as any representation or promise or guarantee of potential future profits. Past performance is not indicative of future performance.
(v) The author makes no representations whatsoever and assumes no responsibility as to the suitability, accuracy, completeness or validity of the information or the forecasts provided.
(vi) All opinions expressed herein are subject to change at any time, without any notice to anyone.
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