Thanksgiving Week and End of Year Trends

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from MoneyMiser21: Before you slide up to the table for extra helpings of turkey, stuffing, and pumpkin pie… there are several 21st Century trade trends you may want to consider before Thanksgiving week arrives.

THANKSGIVING WEEK TRENDS

Some traders won’t be surprised to learn that the week of Thanksgiving itself shows a bullish trend so far this century. But what you may be surprised to learn is which of the big four indices stands out the most.

Starting with Thanksgiving week in 2000, the cash indices for the S&P 500 ($SPX), the Nasdaq 100 ($NDX), and the Dow Jones Industrial Average ($DJI) each show a record of 11-8.

That’s eleven times the close ended the week higher than its open.

But it’s the Russell 2000 ($RUT) where we find the standout with a 13-6 record, making it slightly better than a 2/3rds win rate.

Options traders can figure out what to do with those type of odds.

THANKSGIVING WEEK THROUGH THE END OF YEAR TRENDS

Moving out to a larger, swing-trading timeframe… the indices show a bullish bias as well, with some interesting differences.

The setup: What is the relationship of the close for the week prior to Thanksgiving versus the close price at the end of the year?

The Dow Jones Industrial Average stands out as the clear winner for the 21st Century. The $DJI shows a record of 15-4.

That’s 15 times where the close price at the end of the year was higher than the close price for the end of the week before Thanksgiving.

For the S&P 500, it’s 14-5. Of note, one of the losing years saw a close within five points of the close from the week before Thanksgiving.

The Russell 2000 also showed a 14-5 record, with two of the losing years showing closes within five points of the close from the week before Thanksgiving.

Surprisingly it’s the NASDAQ 100 which falls behind the others into the end of the year, with an 11-8 record. Only one of its losing years closed within five points of the close from the week before Thanksgiving.

Again, options traders know a variety of ways to potentially take advantage of such trends.

Happy early Thanksgiving everyone!

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