It was a bullish month for the US equity market, SPX +199pts (4.4%) to 4766, with the Transports +635pts (4.0%) to 16478. WTIC soared +$9.03 (13.6%) to $75.21. Copper gained +18cents (4.3%) to $4.46. The USD cooled by -41bps to DXY 95.59. The US 10yr yield +9bps to 1.52%.
SPX, monthly
Trans, monthly
WTIC, monthly
Copper, monthly
USD, monthly
US 10yr yield, monthly
Summary
Equities: The SPX broke a new hist’ high of 4808. The December candle is bullish engulfing, and is highly suggestive of higher highs in January. Momentum subtly ticked back upward, remaining on the very high side. I’d note the monthly 10MA at 4381, the bulls need have no sleepless nights unless a settlement under it, which doesn’t look likely for some months.
The transports gained a powerful 4.0%, as the 17000s look pretty easy. The ‘AVIS spike’ of November remains something to be dismissed as ‘rogue’.
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WTIC: Oil recovered over half of the November drop, settling the year in the $75s, an impressive move from the 2020 settlement of $48.52. Soft target is psy’ $80, and then the recent $85s. Giant psy’ $100 appears extremely likely by mid 2022. Tom Lee recently mentioned $120, with JPM $125.
Copper: negating all of the November declines, and ending 2021 on a positive note, having broken a new hist’ high this May of $4.88. A push to psy’ $5.00 appears due within 2-4mths. From there… I’ll be looking for the $7s.
USD: the dollar saw net cooling into year end, but is comfortably holding above first major support of the 10MA in the 93s. Higher rates in 2022 will certainly help. This is year SEVEN of broad chop, stuck within the 88-103s.
Bonds/yields: yields were net higher in December. Rate hike’1 appears due within March/April, and in theory, bond yields should broadly climb into mid 2022. Soft target is the recent high of 1.74%, and then key price threshold of 2.25%, rather than psy’ 2.00%.
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Dear Subscribers (and guests!)
… and that concludes another year at the world’s most entertaining, twisted, and rigged casino. Congratulations to the survivors. For now, I will merely note that 2021 was a pretty fine year. I will elaborate more in my outlook for 2022… but that isn’t due until next weekend.
As ever, feel free to message me via Disqus or email.
Sincerely, Happy New Year!
yours… Philip
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*The weekend post will appear Sat’12pm EDT @ https://tradingsunset.blogspot.com, and will detail ten of the world equity markets.
**I will endeavour to cover as many of the monthly/annual individual stock settlements on Twitter, probably this Sunday afternoon/evening.