Summary
As we enter one of the most positive times of the year for the stock market, from December 19, 2024 to January 2, 2025, we note that the market has not been kind to average stocks and many sectors since last. part of November. Some blame this on tax loss sales, which is likely. But there are sectors and indices that are falling from all-time highs, or at least a 2024 high, so there can’t be any tax selling there. The NYSE breadth was -1,611 on Tuesday, as the streak of weak breadth continues. The 12-day NYSE advances/total issues fell to 39%, one of the weakest numbers in the past two years. And again, the weakest indices were the NYSE, S&P 400, and S&P 600. We see some interesting Commitment of Traders (COT) data, as well as some troubling data (it just depends on which market). We mentioned earlier that the combined hedgers’ position on the main index was quite bearish – and if we look at two of the index components, we see that the positions of the S&P 500 and the Nasdaq 100 hedgers are both bearish, as the smart money hedgers are on or near the index. their most negative futures positions. At the same time, large speculators (hedge funds, momentum junkies) are extremely bullish in their futures positions