MBCC Trading Highlights 15th December'22 - "The market may give a false sense of illusion into Quadruple Witching this Friday but what is really happening underneath the surface?"

The December/Santa Claus rally is all and well and usually markets do “tend” to rally into the last 2 weeks due to illiquidity and window dressing into year end. But it is never a good strategy to be positioned “just for that”. Investment is about risk vs reward, and if you see 30% upside or downside, do you really care about “trying to catch the 5%” and being cheeky? Because as we all know, when everyone expects something, Sods law, the opposite happens. No one expects a market collapse this side of Xmas, but the Fed’s message was straightforward, their work is not done.

The Derivatives market set up is giving the illusion of support as the market is very levered around the 4000 level. We discuss why and what it means for Equities/Bonds in our note today and what the TRADE IDEA is today.

We look at our cross asset model signals to see what is happening underneath the surface, as sometimes, December is a lot of noise, but the thesis remains intact. Equities are the most unsophisticated of asset classes as they get pushed and pulled by a host of factors, distorting the true path, but therein lies the opportunity!

Sign up as we discuss our views on Gold, Silver, Oil, Copper, and Equities and what the trade here is into Jan!