Looking at the S&P 500, we examined the last 15 years worth of data in relation to the holiday season. Averaging out the gains and losses for the period, the average increase from Black Friday to Christmas is 1.5%. Eliminating the four declining years, the remaining eleven average to  3.6%  gains. 

As we enter into the final month of the year, all eyes turn to retail sales as the holiday season is now in full swing. Despite the fewest number of shopping days possible, 23, between Thanksgiving and Christmas, there is a lot to be optimistic about! According to CNBC.com, preliminary Black Friday numbers indicate shoppers spent   $7.4 billion  online. This puts Black Friday as the second largest online sales day ever, second only to last year’s Cyber Monday. As we head into this year’s Cyber Monday, analysts are predicting  $9.4 billion  in sales, nearly a 19% ​jump year-over-year.

Looking at the S&P 500, we examined the last 15 years worth of data in relation to the holiday season. Averaging out the gains and losses for the period, the average increase from Black Friday to Christmas is 1.5%. Eliminating the four declining years, the remaining eleven average to  3.6%  gains. 
 
Drilling into the data a little more, we find that when the calendar month of November sees gains of 3% or more, there is greater than an  80% chance  of a Santa Claus rally - averaging 2.3% per year. November 2019 locked in gains of 3.6% in the S&P 500.



The S&P 500 is up over 25% YTD, is there still room for a Santa Claus rally for 2019? In short, yes, we believe a 1.5% to 2% rally between now and Christmas is likely. Uncertainty around trade deals and Impeachment aside, the U.S. is heading into an election year and this strong market appears to have enough momentum to carry us into the new year. 

​There are a couple of things to be mindful of. First, the market has been extremely strong and does need to take a natural pause. It is not uncommon for the Market to sell-off in the week between Christmas and New Year’s due to profit taking and lighter trading volume. Tax planning, loss harvesting, and other year-end strategies often drive this, especially if the Santa Claus rally was particularly strong. Secondly, it is important to enter into January of the New Year with a solid plan. Nearly half of the last fifteen Januarys ended lower than they began, even if there was a strong holiday rally and / or December. Get ready to end the year on a strong note, enjoy the holiday season, and begin preparing for a new decade to begin.
 
Cheers to your happy and prosperous holiday season!

If you are not having frequent conversations with your wealth or investment advisor about market strategies, investment management, or financial planning opportunities, you should be.  Momentum Private Wealth Management  specializes in Wealth Management as well as Comprehensive Financial Planning. Feel free to reach out to Austin directly at 512.416.8085 or austin@momentumpwm.com. You can also find out more information about MPWM at: www.momentumpwm.com.

The views and market predictions expressed in this newsletter do not necessarily reflect the views​ of Momentum Private Wealth Management, LLC, or any of it's principals thereof. 

Justin Toedtman is a market strategist and contributing editor to Momentum Private Wealth Management. For the last 20 years, his focus has been on technical analysis and market strategies.​

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