The sell-then-buy effect is in gear as we end the year. Sell your losses hard to take losses that will be reflected in your tax liability come 2016, then immediately buy back your favorites out of the stocks you just sold. Nifty, eh?
Although we usually experience this process earlier in December, here it comes now with the curtain ringing down on 2015. Better late than never, one might say.
Beyond that you can make a long list of factors pushing stocks higher today.
Both West Texas Intermediate and Brent North Sea crudes have stabilized for the moment, with a slight upward bias. Lighter volume helped exaggerate the upward movement, small trading energy blossoming into bigger price moves.
Colder weather in North America helped push natural gas higher and that had a bit of gravitational pull on oil.
According to the S&P Case-Schiller index, home values in October were 5.2% higher year-over-year, greater than the 4.9% annual gain in September.
At 96.5, Consumer Confidence topped expectations. That was also reflected in a rise in retail sales of staggering proportions since Black Friday – 7.9% – that shows Americans either have more disposable income or are in better credit health. Retail sales are up in Q3 by 3.9%, not bad either.
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Gold attempted to continue to rally but a mildly stronger U.S. dollar and limp physical demand worked against gold, keeping it more or less in neutral. Silver was up a small fraction. However, platinum and palladium were up around 1.00% at 3PM in New York.
Gold’s long-term prospects on the bullish side are limited by concerns over the potential for a number of Federal Reserve rate rises, which will make gold less attractive to hold. “Safe” plays will include more bond holding, and even more money moving into cash.
However, the fundamental forecast for the yellow precious metal is not all bad. There will be plenty of opportunity to buy on dips or sell into small rallies.
Regardless of which investment opportunity you look at, the start of a new year is often a good time to dive in. People are feeling optimistic; it “feels” like a good time to take a risk; and any losses can be papered over by better moves later in the year.
2016 ticks ever closer.
For those who would like a deeper analysis with detailed buy and sell recommendations, I invite you to try our daily video newsletter. Simply use the link at the bottom of this report to sign up for a free trial.
Wishing you, as always, good trading,
Gary Wagner
thegoldforecast.com
