S&P 500’s Christmas Bias
Published December 24th, 2007 in Technical Analysis Tags: christmas bias, holiday bias, S&P 500, santa claus rally, seasonality.The stock market tends to move higher the day before and the three days after the Christmas holiday. While the S&P 500 gained an average of 0.035% per trading day since 1950, the S&P 500 has produced an average gain of 0.23% for the day before and each of the three trading days after the Christmas holiday. It is also interesting to note that the S&P 500 has traded higher after these four days 80.7% of the time. Now that’s a merry Christmas!

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Today’s very minute gains were able to just barely keep alive the streak of 10 consecutive higher closes the day after Christmas. I think being long is the way to go this week, but next week could be more difficult.