Monthly Drawdown Likely At Some Point
Good start but expect a retracement. Clearly, Hoofy set a positive tone for the month. I highlighted in the buzz yesterday that, based on the first day of the month's action, there was a high probability of an up close for December. But there's an equally high probability that we'll retrace all of yesterday's gains at some point this month. The maximum highs and lows for the month are listed below. Keep this in mind as we find our way through December.
The SP futures were introduced in 1982. The highlighted months represent a first day of month gap open by the SP that did not trade lower on the day (as was the case yesterday). Still, the index managed to see lower prices on the month 2/3 of the time. And if we isolate just the "December" occurrences, there were three. All three gapped higher the first day, managed to post a monthly low of at least -.45% but finished the month higher by at least 1.57%.
So how good was November? I mentioned previously that the Russell 2000 scored one of the best monthly gains in its history. The table below shows all 8% or more monthly gains and the next month's return.
Remember Minyans, past performance does not indicate future results.
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