It feels like the wheel is falling apart and the end of world is approaching. Given the uncertainty all around with no buying from big guys from the Street (most of them are already off for X'mas), the market can only sell. But don't be surprised for a "rip your face off" kind of rally in the final days of the year. There are two forces that can potentially trigger it. The market is so oversold right now, it may be just one headline away for a revenge rally. There is also year-end rebalancing among pension funds, which should be in the billions of dollars. Any further selling to start the week could be buoyed with the anticipation of pension funds buying into year-end. Of course nothing is guaranteed as bears simply have the strongest hand at the moment. But one thing I'm pretty sure is that the world will not end!👼💃
One observation is that EWH (HK stocks) are continuously outperforming S&P each and everyday as I described in my last blog. Pretty amazing! Anyway, wish Santa Clause bringing good luck to all of us in the new year! For now, just forget about stocks and enjoy the holiday break, folks!!
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