This web space was created in late 2007 just to promote my book.
Then market's developments in this terrible season have been the catalyst for further updates.
Roberto is by now a landmark of my site always inspired by intellectual honesty. Precisely in order to improve site contributions, his wisdom and his spirit of observation are became welcome to me.
Therefore these Roberto’s features make him a guest drive of these pages.
We now provides a quick update of his point of view about Santa Claus rally!

ROBERTO CAPUZZI
Why is Santa Claus’ sledge not taking off?

Outlook on Wall Street Christmas Rally - 2008/12/06


S&P500 hourly chart November-December 2008

Christmas day is getting closer but it seems the seasonal rally is struggling to emerge.
Let’s take a look at the market to understand why.
Last Friday the NYSE closed with 30% of stocks on buy signals but just a 6% on a positive trend.
What does this mean?
It means the market is reluctant to follow positive signals. There is still no confidence. For the time, being what we can see in the chart, it’s just a feeble reaction in a downtrend.
Thus, when is Christmas rally going to start? On the one hand if the S&P500 index will have the strength to break the resistance at 896 (green line) with a consistent market activity (% of stocks on buy signals and % of stocks on positive trend) the chance of a following rally will be extremely high.
On the other hand if the market will drop below 839 (yellow line) first and then 815 (red line) with a deteriorating market activity most likely we will go back to the bottom at 741.
Especially in this period it’s extremely important to look at the technical level together with the market activity to avoid to get fooled by tricky ups and downs of the market.

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Manerbio, 2008 Dicember, the 7th

DISCLAIMER

Please Note:
I pareri espressi in questa sede sono solo fonte di studi attribuibili unicamente al sottoscritto (o a suoi fedelissimi colleghi di analisi) e, tantomeno, menchemeno, più o meno, rappresentano raccomandazioni di operatività sui mercati.