STATE OF THE MARKETS

Holiday moods dominate thin markets. US equities traded lower in thin markets that are dominated by holiday moods as traders and investors gearing up to close their book for the year end. All three major indexes, Dow (-0.2%), S&P500 (-0.2%) and Nasdaq (-0.4%) retreated after previous rally of record high when the fiscal stimulus finally signed into law. Bond yields remain relatively unchanged as the US senate need to vote for the $2,000 stimulus check.

Crude closed higher, above $48.10/bl, as markets expect a bullish report on the US oil inventories Wednesday. 2.1 million barrels are expected to be reduced from the Cushing inventories as demand returns post vaccine news. The yellow metal gold, closed higher as well, almost $1,878/oz, as investors weighed the inflation effects of the new stimulus bill which weigh heavy on the Greenback.

Dollar index (DXY) lost the 90 handle support and traded lower to the benefits of commodity currencies Aussie and Kiwi. Short-term traders still seemed concerned as the safe-haven Swiss remains in demand to hedge any unpleasant surprises as the year come to close. Recent CFTC positioning revealed that speculators remain bearish on the Greenback and Aussie; while turned bullish on Loonie.

OUR PICK – No New Pick

No new pick for the year end due to thin markets. Year end is the time to reflect upon our performances and what have we done well and what could have been better. How good have we been in following our processes and procedures in the trading plan. Have we able to achieve our yearly goals with the plan. How has the markets changed for the past 12 months and how well we navigated those changes. Anything new that need to be incorporated into the plan if markets dynamics have changed. These are all questions we have for ourselves and we believe you should ask yourselves too. Happy holidays and may the coming New Year bring you greater joy and fulfillment.