Market sentiment
The tone has improved meaningfully compared to yesterday’s risk-off session. The early rebound across all three major U.S. indices suggests that markets are treating the recent dip as a routine shakeout rather than the start of a deeper correction. Positioning remains cautious but not pessimistic, and volatility is stabilising. Investors appear willing to rotate rather than de-risk.
December seasonality
Historically, December tends to favour a “soft start, strong finish” profile. The early pullback this month fits that pattern. Several factors support the odds of a constructive December:
• Rate-cut expectations remain intact.
• Liquidity conditions are steady as the Fed winds down QT.
• Fund managers often window-dress into year-end, supporting index-heavy names.
A smooth path is never guaranteed, yet the underlying backdrop remains supportive of a firm close.
Personal positioning for December
My focus is on disciplined participation rather than chasing every move. I am concentrating on:
• selective exposure to large-cap tech and communication services,
• managing volatility through defined-risk structures,
• avoiding oversized positions later in the month when liquidity thins.
Goal for the month
The main aim is consistency rather than aggressive return seeking. For those who have already met their annual targets, scaling back and protecting gains is entirely reasonable. For others, December offers opportunities, though measured position sizing and tighter risk controls are advisable due to increased year-end swings.
Overall, sentiment is constructive, but prudence remains valuable as the year draws to a close.
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