Year-Ending Rallies and the Global Good News Trifecta
A few weeks ago I wrote an in-depth analysis as to why I thought the market would rise before year-end. The publishing of this analysis is the reason why the market then sold off for 9 straight days.
Eventually though, reality has set-in and the past three-days rally was capped off by yesterday’s global good news trifecta (China, Europe, and US economic news “coincidently” coming together within hours of the last trading day of the month). Now all the mutual funds and investment firms can show only a small down performance for November instead of a large down performance. The business and political psychology of this is substantial.
The powers that be want to see prices higher by year-end, so December is going to be a battle of economic reality versus government and financial industry intervention (the latter usually wins).
The above is from Larry Connors’ Daily Battle Plan.
To learn more about the Daily Battle Plan, click here for more information.
Larry Connors is founder of TradingMarkets.com