On December 27th, on the first day of the last trading week of the year, the US stock market welcomed the long-awaited "Christmas market"

As of the close of December 27th local time, the three major US stock indices have closed higher for the fourth consecutive trading day. Among them, the S&P 500 index rose 65.40 points, or 1.38%, to 4791.19 points, marking the 69th closing high of the year. Santa Rally refers to the last five trading days of each year and the first two trading days of the New Year, where the stock market often performs exceptionally strongly. This is also a manifestation of the "calendar effect".

①According to LPL Financial's statistics, there is a 78.9% chance that the S&P 500 index will rise in these seven trading days over the past 70 years. Meanwhile, the S&P 500's average increase in the Christmas market over the past seven days can reach 1.33%.

More interestingly, according to historical market trends, if the S&P 500 index gains at least 1% on its first day during the Christmas market, it will continue to have a "good start" in the future. Since 1929, the S&P 500 index has experienced eight successful gains, with an average increase of 3.3% during this period.

The reason for the miraculous change in the Christmas market is speculated to be that more funds will be invested in pension plans such as 401K and IRA at the end of the year, which will allow more money to flow into the stock market.

In addition, a large portion is also influenced by market expectations. The stronger investors' expectations for the Christmas market, the more investors will plan ahead during this period, making the stock market rise a reality.

②The Christmas market not only has a magical effect on these seven trading days, but also has a certain impact on the trend in January.

Based on historical experience, if the S&P 500 index shows a gain of at least 1% on the first day of the Christmas market, it usually goes higher in January, with an average increase of 2.94% and a median increase of 3.7%.

But if the S&P 500 index does not rise but falls during the Christmas market, then January usually also tends to weaken. Examples of declines include 1999, 2005, 2008, 2015, and 2016.

③In addition to studying historical market trends, investors should also focus on the current environment facing the US stock market.

It is undeniable that, although the rebound of the S&P 500 index from November last year to April this year benefited from most of the stocks in the index, since April this year, 51% of the return of the index has come from five stocks, namely Apple, Microsoft, Nvidia, Tesla and Google. That is, the foam of Internet overvaluation may once again threaten the market environment.

On the other hand, high inflation, tightening policies by central banks, stricter travel restrictions on a global scale brought about by the Omicron variant, and a slowdown in economic growth are a series of concerns that may intensify in 2022.

Therefore, it is better to prepare with both hands when buying a unilateral trend. Observing the Christmas market, short-term speculation, fast in and fast out; Looking at the year-round market, long-term ambush, earning high profits, and controlling the long and short directions.

Start investing immediately in 2022 and easily achieve "win before run".