Christmas in the Financial Markets
Today, we’re looking at Christmas in the financial markets. Should you put your feet up with a mince pie and a hot cocoa or is it all aboard the Santa Rally? Once done, we’ll give you our usual run-down of the top fundamental events to watch out for this week. Let’s Go Ho Ho!
Do The Markets Take Time Off Over The Holidays?
Good question. Like many things in trading, it totally depends on what market you’re looking at. Aside from being closed at weekends anyway, traditional markets, such as Forex, stocks, and commodities are all shut down for Christmas Day and New Years’ day — which, coincidentally happen to be on Saturdays this year anyway!
If you’re a crypto trader, get your coffee percolating because there won’t be any time to rest! The crypto market is open 24/7 and is totally oblivious to holidays.
In fact, the crypto market is often most active around the end-of-year period. Veterans of Christmas 2017 will likely still remember that that was the year that crypto did this, out of nowhere…
Crypto total market cap, 2017–18
Source: Coinmarketcap
NB. We’re only joking about the not resting bit! Rest and general down-time are an important part of any trading strategy. You need to relax and recover to be at your best when the time comes! So, eat, drink and be merry!
What is the Santa Rally?
Seasoned traders among you will know that the stock market has this really weird tradition of picking up in the last few weeks of December and into the New Year. When this happens, it’s largely attributed to good ol’ St. Nick chucking his magical holiday dust over the markets and, therefore, appropriately dubbed a Santa Rally.
Amazingly, more than two-thirds of Decembers since the 1960s have led to positive gains for shareholders.
Obviously, we all know that Santa is 100% real, but if you don’t happen to believe in his magical holiday dust, there are several other theories that try to explain why the Santa Rally happens. The popular among these state that it has something to do with either:
- The increase in holiday shopping and consumer spending, giving a nice boost to retail.
- The general merry optimism fuelled by the holiday spirit, perhaps loosening trader’s purse strings just a little.
- The fact that the slightly more scrupulous institutional investors tend to settle their books before going on off on their holidays, leaving the ever so slightly more impetuous retail investors to do their thang. Impetuously.
…But we’re sticking with magical holiday dust. In case you wanted to know.
How Do You Feel About Trading At Christmas?
Will you be taking on the Santa Rally, filling your stocking with trading goodies? Or will you have a break and avoid the potential volatility? Let us know by tweeting us at @_Contentworks!
Top trading events week commencing 13/12/21
There’s quite a lot going on this week, here’s where you should be looking.
Monday
No major events planned.
Tuesday
● GBP — Employment Change (SEP); Unemployment Rate (OCT)
Wednesday
● GBP — Inflation Rate YoY (NOV)
● CAD — Inflation Rate YoY (NOV)
● USD — Retail Sales MoM (NOV); Fed Interest Rate Decision
● NZD — GDP Growth Rate YoY (Q3)
Thursday
● AUD — Employment Change (NOV)
● GBP — BoE Interest Rate Decision
● EUR — ECB Interest Rate Decision
● USD — Markit Manufacturing PMI Flash (DEC)
Friday
● JPY — BoJ Interest Rate Decision
● EUR — Core Inflation Rate YoY Final (NOV)
Here at Contentworks we closely follow market movements and prep content that we think your traders would love to read. Let’s get you started right here.
Speak soon. Oh, and Merry Christmas!
The Contentworks team
