Wednesday, December 23, 2015

Santa Rally?

We are in the middle of the Santa rally.  Without any share issuance this week and with the post opex selling now over with, the desperate sellers are mostly done and with an absence of sellers, you get a low volume rise higher.  This is not aggressive buying here.  Most of the big boys are done for the year and planning for 2016.

This Santa rally should last the rest of this week, but beyond that, you are hoping for greater fools to jump in.  I don't see that happening after a flat year in the market, and nervousness ahead of 2016.

There is a huge wall of worry for next year.  Unless things really get bad, such as oil going to the low 30s and staying there, we should have a strong first quarter.  The first quarter is usually a bullish quarter as investors put in allocations to stocks.  Unlike this year, I think the trends will last longer and it will be less choppy than this year.  It is almost as if dip buying is getting too easy now with every dip except the one in August being contained to no more than 6-7%, and being met with immediate buying.  Even the August dip was met with aggressive buying after the first bottom.  We've had very few dips where the market goes down and stays down.  Most have been V dips.

Expecting a grind higher for the rest of this week.  Should give back some of this week's gains next week however.

I am taking a blog break till the first trading day of January.  I may post some comments occasionally here and in Twitter.  Merry Christmas and Happy New Year.


Chris Phelps said...

I have really enjoyed your blog. HH

shzhning said...

Me too. I find this blog enlightening

Wishing you a prosperous new year!

Pip Stewart said...

The best blog, for sure👍 The only one worth reading. Looking forward to next year's posts. Merry Christmas from Pip Stewart. Manchester UK