So Far, The Bulls Are Disappointed In “Santa” (Full Version)

Bulls Disappointed In Santa, So Far, The Bulls Are Disappointed In “Santa” (Full Version)

While the statistics suggested that the last week of December should have been a bullish one, it didn’t entirely turn out that way. Okay, let’s be honest, it was just a bit disappointing. Lot’s of chopping around all week and a final spurt at the close yesterday. Not exactly confidence-inspiring.

As shown in the chart below, the market closed just 0.87% higher than the previous all-time high set mid-month. However, the good news is the last high did hold as support. Such sets up the possibility for “Santa” to “deliver” on the New Year’s first two days.

Bulls Disappointed In Santa, So Far, The Bulls Are Disappointed In “Santa” (Full Version)

Also, another bullish setup is that the short-term technical money-flow signals have gotten a bit oversold. From these levels, it would not be surprising for the market to stage a short-term rally during the first couple of weeks of January. Such was a point I made earlier this week:

It certainly seems as if there is no risk. But maybe that is the risk.

Everyone Is On The Same Side Of The Boat

Currently, every single analyst has the same story going into 2021.

  • Prepare for an economic boom.
  • Interest rates will rise.
  • Inflation is coming back.
  • The stock market is going to 4100-4500
  • Small-caps are the new “new trade.” 

You get the idea. Everyone is incredibly “bullish” about the coming year.

While that “wish list” could undoubtedly turn out to be the case, there is much that could go wrong. More importantly, there is also Bob Farrell’s truism, which is:

“When all experts agree, something else tends to happen.”

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