After two exhausting months…one is really starting for the Santa Claus Rally.
If it does appear – and I believe in Santa) two dates are important.
A) 1st December – meeting President Trump – President Xi – a mildly positive statement (like freezing of tariffs) would be a positive for the market triggering some short covering.
The China issues is a the only constant in Trump’s life. Since the 1990s he has identified (correctly) China as an issue for US world dominance. Even so, he is pragmatic and listen to his voter -base. Plus always looks at the market as a vote on his Presidency. He could well take a pause.
19th December – The last meeting of the year of the FED will be followed by a release statement for 2019 rates hike. A hint of a dovish take (less than the 3-4 rates hikes in the FED forecast) would definitely spur a rally.
Already 2 of the members of the FED declared that the interest rates are close to neutral for the FED and the FED is aware of the global slowdown and end of the tax -relief growth spur.
Let’s wish Santa to come!
investorpolitico 