There Is No Sign Of Santa For Investors Right Now, But Is He On His Way?

There are several problems with reading charts, but probably the biggest is that the message from a chart is rarely, if ever, clear-cut. Chart patterns and the conclusions we draw from them are, like beauty, in the eye of the beholder. It took me many years of working in financial markets to understand that. Every time someone graced me with their interpretation of a chart, they sounded so definitive, so certain, that there seemed to be only one way to look at things. Over time though, I came to realize that if you gave two people the same chart and asked them to predict the next move, there was a decent chance that one would say up and the other down.

Take the chart for this recent move, for example. There are two distinct ways of viewing, or rather interpreting, the one-year chart for S&P 500 futures (ES). One suggests that this year, there will be no Santa Clause, or at least no rally named for him, the other indicates that he is on his sleigh and heading our way.