A Quick Look At The Markets Before Christmas…
With Christmas approaching quickly, I wanted to check in with our readers and make a few comments before we all step away for the holiday. With that said, this essay will be a little more condensed than usual.
The markets will close early on Thursday, December 24 (1 pm ET). Markets will be closed for Christmas on Friday, December 25. They will also be closed on New Years Day, which is Friday, January 1.
Keep in mind as you enter — and watch — your trades that trading volumes tend to be light around the holidays. This can sometimes exaggerate price movements (both up and down).
Case in point, the next scheduled issue of my Maximum Profit service is January 7. But of course, the markets wait for no one. So if we hit any price targets or stop losses between now and then I plan to send my readers an alert.
So by all means, take some time away and enjoy your family. But especially if you’re trading the market, make sure you step away the right way. Rather that’s setting up alerts on your phone or having stop-losses in place, make sure you do what you need to do…
Okay, now that we’ve got the housekeeping out of the way, let’s briefly touch on markets…
Where We Stand…
We’ve received some pretty big news in the last couple of weeks with the announcement that a second vaccine from Moderna (Nasdaq: MRNA) was approved by the U.S. Food and Drug Administration (FDA) on December 18. This followed the first approval earlier in the month of Pfizer (NYSE: PFE)-BioNTech’s vaccine. Then over the weekend, the folks on Capitol Hill finally agreed to another round of stimulus to the tune of $900 billion.
While futures markets initially reacted positively on Sunday evening, things quickly turned south as word spread that the United Kingdom had identified a new fast-spreading strain of the virus. That spooked markets on Monday, with the S&P 500 opening lower on the day before recovering much of those losses.
Barring any major news, I expect the market to trade sideways and possibly even climb back towards its all-time highs as we make our way through the holidays. Historically, the market typically does well this time of year and into the first week of the New Year. It’s often referred to as the “Santa Claus” rally, and we shall see if that holds true this year.
Despite the rocky start to this week’s trading session, most of our holdings over at Maximum Profit are doing quite well. Many are even reaching new 52-week highs.
For instance, a cloud-based cybersecurity stock we are trading has popped higher by more than 18% in just the last three trading sessions. The stock is up more than 130% in the roughly six months we’ve held it.
Our two real-estate plays are also proving to be excellent trades. The first is up more than 70% since we added it ON September 4, while the other has exploded for a nice 80%-plus return in less than two months.
Outside of a few of our holdings, all are beating the S&P 500 by a wide margin over their respective holding periods…
So, despite all the craziness that 2020 has delivered, the market has performed exceptionally well. The the S&P 500 is up more than 14% on the year. And our Maximum Profit portfolio has done even better, as a number of our trades climbed double and triple digits in a short amount of time.
But as I’ve repeatedly warned, this has been an anomaly on multiple fronts. We need to keep our expectations — and emotions — in check.
Before I wrap this up, I just want to wish each and every one of you a healthy, happy, and wonderful holiday season. Enjoy your time away from screens and with family and friends.
And here’s to a healthy, wealthy, and prosperous 2021!
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