Traditionally, in late December, the U.S. stock market performs a rally worthy of mention right around the Christmas holiday. Traders and market observers alike have dubbed it the “Santa Claus Rally.”
But traditions change and this one may be coming to an end of Monday’s trading session is any indication of what’s to come.
The Dow Jones Industrial Average actually lost 2 points on Tuesday to close at 12,291. It remains well above the 12,000 mark and could even break 13,000 in the next two months if the Bulls get their way.
Meanwhile, the S&P 500 closed flat at 1265. If it can break the 1271 technical level, the next stop could be 1315 for traders who are pushing and pulling the SPY. Monday’s range was extremely tight anyway.
No matter what occurs in Europe or the U.S. political landscape, the consensus among traders is that this week will be a slow one with low volatility and volume to boot. The Chicago Board Options Exchange Volatility Index (VIX) is down at the 21 level and is close to breaking 20 this week.
One trader on Twitter summed up the day’s trading with this quote: “Both Nasdaq and NYSE volumes were barely 50% of their 3 month averages today.”
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