To OTC Journal Members: 
 

Santa Rally Time

The market is returning to normal- what ever normal is. There really isn't any normal for the stock market, but there are seasonal patterns. 2008- still a very painful memory- blew up the normal seasonal patterns. The market had its worst months in the October to March time frame, and then started behaving better after March of '09. Normally, the calendar is flipped.

October to March is normally the best time to be in the market. This year, we've returned to normal. I believe there are several reasons for this phenomenon. For starters- in the US, Q3 is generally the worst quarter of the year for corporate performance. Q3 corresponds with summer when a lot of folks are goofing off and less productive.

The market starts to price in a weaker Q3 in May, and generally stays that way into September and October. The market then starts to price in Q4- usually the best quarter on the calendar. There's another historical factor as well most people don't even think about related to liquidity.

In the early 20th Century we were primarily an agrarian economy. Crops were planted in the Spring, and harvested in the Fall. Banks loaned substantial amounts of capital to the farming community to finance the harvesting and eventual sales of their products before winter set in.

As the banks became reliquified from the farming community getting their product to market and paying off those loans, they looked for investment opportunities. The stock market generally traded up in this season. These factors play no roll in today's economy, but I do believe the seasonality of the market can find its roots in this 100 year old pattern.

Believe it or not, I went shopping on Black Friday. It's not what you're thinking- I wouldn't be caught dead at the Mall. I went shopping for a trading idea, and I found one.

Monday, pre open, Santa has found you an idea that might put some extra cash in your Christmas stocking. We clipped off a nice 14% on FieldPoint (FPP) if you acted early. If you're ready to do some shopping that might pay off for you, get ready to look at a new idea just before the open on Monday. 

Let's start the post Thanksgiving Santa rally off with a bang. Get ready to check your inbox just before the open Monday for a great idea for a trade.

Home Page : www.otcjournal.com
Email Questions or Comments To: editor@otcjournal.com