Work in progress ...
Ho ho ho!
Its soon approaching Christmas (dare I even say it) although I think as early as late October I recall seeing baubles and festive goodies in the local shops.
It has been a bit of a mixed year really, started good, then flatlined. Still need to review overall performance although that will come end of year.
I thought I’d kick off early and knock up a quick thread for the infamous Christmas rally. Especially with the marktes having sold off very recently (on 26 Oct the FTSE 100 saw a low of around 6,854 there is some argument for entering a starting stake soonish, to take advantage of the low spot, and adding to that if the markets look favourable or closing it out if the volatility persists.
The FTSE is currently in line with its 20day EMA, around the 7,100 level, and under the 100EMS of 7,338.
We had a high of 7,903 on 02 May 2018, and the year low as mentioned above was 26 October.
Looking back to last year, November the rally did not kick off really until 8th December, and through November lost about 200 points from 7,500 level down to 7,300 through the month.
According to the 2018 Almanac, which is full of great stats and insight, a plotted FTSE 100 index taking data from 2000 to 2016, in the trading days from early November to to end December, the month of November is typically flat or weak through the 11th month, with the best indicator of a rise triggered on the 9th December.
The book helpfully points out that trading day 10 of December 2018 will be on date 14 December.
Since 1984 we are told the UKX has risen in 59% of years during November
However, factor this in with what we know : ie, the markets have already gone through a period of some weakness over the last couple of months.
We also need to know what economic events are on the horizon. We can use the IG economic calendar for this https://www.ig.com/uk/marketanalysis/ig-economic-calendar/2018/11
23 Nov US NYSE closed for thanksgiving
05 Dec UK FTSE shuffle
07 Dec US NFPs
13 Dec EUR ECB governing council meeting
These are the events sticking out for me, I’ve left off anything after the 14th December, as we hope the rally to have commenced by then.
Feel free to add your views, TA or charts in the run up to Dec. Feels too early to say ‘I hope it’s been a good year’ at this stage, with two months to go. But let’s see how the next two crucial months unfurl.