After a week of significant losses, many had their eyes on the markets’ performance during the Christmas period to gauge the health and stability of our economy. Here’s how it paned out:
The week began with a truncated trading session on Monday ahead of Christmas Day and saw continued losses on US markets. All of that political fear from the week prior came to a head when President Trump made comments criticizing Federal Reserve Chairman Powell’s performance, which led many to fear that the President oust the Fed leadership. Investors feared unknown changes to the central bank’s policies and hit the sell button, notching SPY down to levels not seen since the spring of 2017 into the low 233’s.
The gloomy outlook seemed to end there, as traders gained incredible optimism over the Christmas break and sent SPY climbing up about $10 on Wednesday. This was actually a record-breaking day on the US markets overall, as the Dow recorded its best day in ten years!
This optimism continued Thursday and Friday, with gains seen in healthcare and banking sectors. SPY also benefited from institutional investors rearranging their portfolios ahead of the new year. SPY reached a weekly high on Friday of 251.40 before profit taking brought it down to about 247.
Coming off record breaking losses, many would have been surprised to see the Santa Clause rally this year. It was a surprise to many indeed as the markets climbed after Christmas and into the weekend. One more trading day to go in 2018 before we see what the new year brings.
Here’s to a happy, healthy and successful 2019!
Hugh W. Grossman, Head Trader at Day Trade SPY.
Hugh Grossman is the founder and Head Trader at DayTradeSPY and uses his vast experience to teach his methods to make consistent daily gains trading SPY options. Join Hugh in his interactive Trading Room to see how he regularly pulls in the profits!
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