November was a very strong month. Returns are ranging up to 11 percent, depending on which index you measure. If you weren’t there, you missed out. The Bull forecasted a strong recovery after the August through October correction. It took a little longer; it usually starts in mid-October, but then wow! (But in truth, most of the gain only got back what the previous three months lost.)

So, now how about December? It is impossible to know for sure, but there is no reason to not expect a continuation of the recent strength in the U.S. stock market. If historic seasonal pattern holds true, then this uptrend should extend well into the new year too.

More importantly though, we expect some catch-up play by many stocks that have been left behind. Seven stocks have accounted for almost all the positive returns this year, the other four hundred ninety-three in the S&P 500 should now come to the fore in leading this market higher. For several practical reasons, this may not begin until after the start of the new year.

Stocks left behind attract tax loss selling this time of year. Also, portfolio managers trying to play catch-up tend to buy what has been working. They also like to show that they own the year’s winners in portfolios. After the turn of the year, it’s all a new challenge and typically changes occur. This is what we expect and are positioning ourselves for it. Stay steady my friends.

The Lonely Bull