[video] S&P 500 Could Hit 1850 During Santa Claus Rally
The video this transcript is based on appeared on December 26.
NEW YORK ( TheStreet) -- Keith Bliss, senior vice president at Cuttone & Co. says with three trading days left in 2013, momentum from the Santa Claus rally could move the S&P 500 past 1850.
The markets today are trading up on what is lighter holiday season lighter volume but the markets are in a momentum phase right now where we certainly expect them to trade higher. Based upon the price action that we've seen last week and what we got earlier this week it's not, it would not be surprising to me if we see the S&P 500 trade all the way up to 1850. Remarkably in some of our quantitative models and technical models we don't see the S&P 500 overbought until it gets up about 1860. So even though we've got only three trading days left in the year we certainly can see the market trade up a couple of percentage points on lower volume and the moves tend to be exaggerated. When you have lower volume like this you could possibly get to our level.
Starting out at the beginning of 2014 I would expect that same continuation of the momentum because you have what's called the January effect, so right now we're in the Santa Claus rally which is that week of trading in between Christmas and New Years when people anticipate the January effect. The January effect is new money that now will be coming into the equity markets. Of all the asset classes in the world you could invest in right now the one that's performed the best in 2013 is US equities. So I would imagine their retail monies as well as institutional money that's been sitting on the sidelines riding into the end of the year will be coming into the market at the beginning of January to keep the rally going for some time.
Written by Keith Bliss in New York.
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