Thursday, December 15, 2011

Santa Claus Rally

The “Don’t Worry, Be Happy” crowd on
Dalal Street would very much like to get their greatest fable into full gear – the Santa Claus rally. Unfortunately, a few silly matters they would like us to consider unimportant, like the financial crisis in Europe and the coming debt disaster here in the U.S., has caused a flight delay of Santa’s ride over Wall & Broad.
But with “Gobble, Gobble” day near, I suspect the “happy” people and their favorite landing place for Santa’s reindeers .
As the name suggests, a Santa Claus Rally is when the stock market indices move higher.
There are certain times of the year when specific markets and sectors do better. We call this seasonality.The Santa Claus rally is a rise in stock prices in the month of December, generally seen over the last week of trading in December.
Focusing on the month of December and taking into account the last 10 years of market activity, I have created probability for you.The December Low Indicator was originated by Lucien Hooper, a Forbes columnist and Wall Street analyst back in the 1970s. Hooper dismissed the importance of January and January's first week as reliable indicators. He noted that the trend could be random or even manipulated during a holiday-shortened week. Instead pay much more attention to the December low. If that low is violated during the first quarter of the New Year, watch out!
As sugested in our blog last time booking profit on Nifty at 5090 turned true we gave you to go short on nifty which in turn did fall to 4670.Now as told previouly 4650 on nifty and 15500 on sensex seems to be good support.Now some bullish stand can be built expecting markets to go up in december .
Thanking You
Atul Sikrai.
Sr Vice President & Head Equities
wiTdom investment advisory.

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