• support@madhedgefundtrader.com
  • Member Login
Mad Hedge Fund Trader
  • Home
  • About
  • Store
  • Luncheons
  • Testimonials
  • Contact Us
  • Click to open the search input field Click to open the search input field Search
  • Menu Menu

December 20, 2024

Jacque's Post

 

(WHAT’S THE MARKET’S NEXT MOVE?)

December 20, 2024

 

Hello everyone

 

This will be my final Post for the year.  I am taking a well-deserved break and will return in around mid-January.  I will keep one eye on the markets, and if I see anything that is worth acting on, I will send out an email.  But, for the most part, I will be taking a break from screens and market research. 

I want to wish you all a very happy festive season and all the good things for 2025. 

The Fed meeting certainly has set the mood for the markets.  Investors were disappointed with what Powell said about rate cuts in 2025, that there would probably be fewer than first thought.  The markets turned up their nose and smacked every sector – basically throwing a hissy fit because they didn’t get what they wanted.  But really, this was a good washout – what you would call a very healthy correction.  It had been building for a while.  I pointed out in Monday’s Post that the technicals were very bearish, and risk was rising. 

So now what?

We can now argue that further downside is possible.  You should not be trying to catch a falling knife at this stage.  We could see another few weeks of consolidation, sort of like a topping action.  Nearby resistance is seen at 5935/45 and 5980/90 (both a 50% retracement from the Dec 6th high at 6100 and the broken bull t-line from August.) 

So, what’s possible:  eventual downside to that bull t-line from October 2023 (5595/20) but some scope for a few weeks of consolidating as year-end approaches first.

Strategy:  too late to sell now.   Instead, sell on a close below 5845 (just below support).  Stop should be above 5885.

Long-term outlook:  further downside is probable to the base of the rising wedge (5595 or so).  Rising wedges are viewed as reversal patterns, with a break/close below the base arguing a downside resolution and more major top (for at least a year).  We have had an extremely overbought market after the last few years of sharp gains.  So, it is important to understand that the potential now for a downside move is increased. 

And one more thing in relation to the overbought market.  We could see a sub $5000 S&P500 in 2025.  It is possible.  I have been saying for quite a while now that we would get a correction in 2025.  It just started earlier than I had anticipated. 

Strategy/position:  We could see one more rally to just above $6100.  That is where you want to be selling calls on the SPY and/or buying the SDS.  (Make sure you have stops in place.)   Also, if you want to scale out of any stocks, that is the time you would do it.    The market will rest for several months to a year but will come roaring back eventually. 

I have already recommended that you sell calls on the precious metals sector.  It is possible all sectors will follow the bearish path because the run-up has been so strong over the last couple of years.

After the 2025 year of strong correction, we are likely to begin another rally on to new highs. 

Bottom Line:  2025 could be a volatile year.

 

 

Cheers

Jacquie

Share this entry
  • Share on Facebook
  • Share on X
  • Share on WhatsApp
  • Share on Pinterest
  • Share on LinkedIn
  • Share by Mail
https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png 0 0 april@madhedgefundtrader.com https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png april@madhedgefundtrader.com2024-12-20 12:00:362024-12-20 13:12:51December 20, 2024

tastytrade, Inc. (“tastytrade”) has entered into a Marketing Agreement with Mad Hedge Fund Trader (“Marketing Agent”) whereby tastytrade pays compensation to Marketing Agent to recommend tastytrade’s brokerage services. The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastytrade and/or any of its affiliated companies. Neither tastytrade nor any of its affiliated companies is responsible for the privacy practices of Marketing Agent or this website. tastytrade does not warrant the accuracy or content of the products or services offered by Marketing Agent or this website. Marketing Agent is independent and is not an affiliate of tastytrade. 

Legal Disclaimer

There is a very high degree of risk involved in trading. Past results are not indicative of future returns. MadHedgeFundTrader.com and all individuals affiliated with this site assume no responsibilities for your trading and investment results. The indicators, strategies, columns, articles and all other features are for educational purposes only and should not be construed as investment advice. Information for futures trading observations are obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. Your use of the trading observations is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness of the information. You must assess the risk of any trade with your broker and make your own independent decisions regarding any securities mentioned herein. Affiliates of MadHedgeFundTrader.com may have a position or effect transactions in the securities described herein (or options thereon) and/or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies.

Copyright © 2025. Mad Hedge Fund Trader. All Rights Reserved. support@madhedgefundtrader.com
  • Privacy Policy
  • Disclaimer
  • FAQ
Link to: Trade Alert - (VST) December 20, 2024 - EXPIRATION AT MAX PROFITS Link to: Trade Alert - (VST) December 20, 2024 - EXPIRATION AT MAX PROFITS Trade Alert - (VST) December 20, 2024 - EXPIRATION AT MAX PROFITS Link to: Trade Alert - (NVDA) December 20, 2024 - EXPIRATION AT MAX PROFIT Link to: Trade Alert - (NVDA) December 20, 2024 - EXPIRATION AT MAX PROFIT Trade Alert - (NVDA) December 20, 2024 - EXPIRATION AT MAX PROFIT
Scroll to top