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Is The "First Of The Year" Market Surge Pattern About To Break?

Tyler Durden's picture




 

A few days ago Goldman pointed out an interesting observation: "if you were an index investor and weren’t long Jan 1st, you underperformed this year." To be sure, index investors have been well aware of this self-fulfilling prophecy. As it turns out, one can extend this pattern not only to 2013 but virtually every year in the Fed's centrally-planned "abnormal", as can be seen on the chart below: adding up the performance of just the first trading day of the year in the S&P shows a total outperformance of 10% across the past five years.

So with the EURUSD futures, at least for now, indicating a very unfamiliar shade of green it may be that for the first time under the Fed's reign this most familiar self-fulfilling prophecy may be about to predict an unhappy ending. And if so, what other pattern-busting surprises are in store in the new year?

Then again, in a record illiquid market where an oddlot of E-minis can push the S&P higher by 5 points, it may be prudent to wait until the closing print before counting one's chickens.

 

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Thu, 01/02/2014 - 09:15 | 4292833 disabledvet
disabledvet's picture

Japan is going bye-bye. Happy trading!

Thu, 01/02/2014 - 11:45 | 4293196 czardas
czardas's picture

Glad that "Watchful Tyler" (the one who closely follows the pronouncements of the Wall Street Big Boys) is back with more good analysis.  Yes, Japan is going down unless they win a technological battle that gives them a huge boost.  The Japanese are resiliant and have memories of sacrifice and hard times so they wlll probably respond far better than we in the West. 

Thu, 01/02/2014 - 09:17 | 4292836 Sufiy
Sufiy's picture


Great rotation 2014:

Albert Cheng: Gold Markets Move East | McAlvany Commentary


 Albert Cheng the head of World Gold Council in China discusses the Gold market in China and how Gold has became the foundation for wealth preservation and saving. http://sufiy.blogspot.co.uk/2014/01/albert-cheng-gold-markets-move-east....

Thu, 01/02/2014 - 09:27 | 4292852 GetZeeGold
GetZeeGold's picture

 

 

We sent them our jobs.....might as well send them real money to pay for the labor.

Thu, 01/02/2014 - 09:24 | 4292847 Musashi Miyamoto
Musashi Miyamoto's picture

BULLISH!

Thu, 01/02/2014 - 09:29 | 4292849 NoDebt
NoDebt's picture

No "fiscal cliff" or "government shutdown" was averted in an 11th hour deal this year, though.

Thu, 01/02/2014 - 09:32 | 4292854 _ConanTheLibert...
_ConanTheLibertarian_'s picture

11th Hour? I never even got time to finish Myst.

Thu, 01/02/2014 - 09:34 | 4292856 Dr. Engali
Dr. Engali's picture

Isn't it about time for gold's early morning spanking?

Thu, 01/02/2014 - 09:37 | 4292863 TeamDepends
TeamDepends's picture

On the contrary, it is the cartel that has assumed the position.

Thu, 01/02/2014 - 09:48 | 4292874 disabledvet
disabledvet's picture

I have fond memories of the dollar surging to over 400/yen back in the 80's. "that was just for starters." IF these yields are about to explode the only safety is in cash...dolares...the only "real" (meaning tradeable) cash money right now. "Snowing in Florida" as they used to say. Oh...and that's only the second largest bond market created in human history. Talk about "Mt Fuji blowing sky high."

Thu, 01/02/2014 - 09:42 | 4292864 satoshi101
satoshi101's picture

My Predictions for 2014

Gold Will Go Down before it Goes Up

Bitcoin Will Go Up before it Goes Down

There you have it.

Thu, 01/02/2014 - 09:46 | 4292869 kurzdump
kurzdump's picture

The only prediction that will come true for sure is "bullshit will go up"

Thu, 01/02/2014 - 12:19 | 4293203 RaceToTheBottom
RaceToTheBottom's picture

After intensive experimental analysis, I can confirm, yes shit floats

Thu, 01/02/2014 - 09:52 | 4292885 GolfHatesMe
GolfHatesMe's picture

Is QEeen Yellen missing page 1?

Thu, 01/02/2014 - 10:04 | 4292913 eddiebe
eddiebe's picture

Could this be the year the rest of the world is calling bullshit in regards to the dollar?

+

-

Thu, 01/02/2014 - 10:04 | 4292916 Rising Sun
Rising Sun's picture

just another day to trade

 

Yellen is in charge now - let's see how much damage this fucking cunt will do

Thu, 01/02/2014 - 10:16 | 4292939 gwar5
gwar5's picture

Tech Bubble, Fed Bubble. It's not irrational exuberance when the Fed does it.

 

Thu, 01/02/2014 - 11:01 | 4293073 TheRideNeverEnds
TheRideNeverEnds's picture

no, we have been up 100% of the first days of the year in the last two decades, we will get a 20 point reversal as people buy the bip then we get back into BTFATH mode till the USD goes to zero and the S&P prints (+-)inf  

Thu, 01/02/2014 - 11:05 | 4293076 DebtSlaveZombie
DebtSlaveZombie's picture

People have been waiting for January 2nd, 2014 to take profits on HUGE gains last year.  It's no surprise to me that the market is down.  Actually, if it were down 2% on the year by next Friday it would make complete sense.  So really, these first 4 or 5 trading sessions of 2014 can be ignored.  Rich people taking a little off to buy some stuff.  As they should... some took in 35-40% in returns last year.  Biggest year in 17 years.  So hell, lets go buy some shit!  S&P 2000 this year by July.  Nikkei 20,000.  DOW 19,000.

Thu, 01/02/2014 - 11:33 | 4293162 CaptainSpaulding
CaptainSpaulding's picture

"I'm gonna have to say no,  And i dont give you my reasons"

  - Don Corleone

Thu, 01/02/2014 - 11:47 | 4293197 RaceToTheBottom
RaceToTheBottom's picture

I miss price discovery

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