Bullish, But Not Blind: How to Trade December’s 74% Win Rate

by Chris Pulver | Dec 3, 2024

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As we head into December, we find ourselves in a unique position — historically, this is one of the most bullish months of the year. But the question remains: Will this year follow suit?

Let’s dig into the probabilities, market dynamics and key levels to watch.

December’s Bullish History

When it comes to historical performance, December holds a special place. Since 1928, December has been a green month 74% of the time. While this doesn’t guarantee a rally every year, the data is hard to ignore.

For context, if the S&P 500 closes at or above 6,025, that’s technically a green month — aligning with that 74% historical probability. Whether the market simply hovers near this level or surges higher is a different story, but even modest upward moves could keep the seasonal trend intact.

The market currently shows solid support, with higher lows forming since September and October. For December, 6,025 to 6,026 emerges as the crucial threshold. This means we might see the market climb higher, pull back slightly, or even test support before rallying again.

Surprises to the downside?

While unlikely, any dips would likely be met with buying interest given the bullish seasonal backdrop.

Caution for 2025

Looking beyond December, I remain cautious heading into 2025.

Valuations are already stretched — we’re nearing the third-highest levels of all time. Historically, these levels have often led to market corrections, not sustained rallies.

That said, I’m not outright bearish. The most likely scenario appears to be a contained market — one that struggles to make significantly higher highs but remains supported by key levels.

Given these dynamics, my approach is simple: Stay cautious but flexible. Look for pullbacks to add positions and avoid chasing a melt-up scenario blindly.

As always, defined-risk trades are critical in navigating the current landscape.

Whether the market follows its bullish seasonal pattern or surprises us with a pause, December is shaping up to be an exciting month to trade. Stay disciplined, and let’s finish the year strong.

I’ll see you in the markets.

Chris Pulver
Chris Pulver Trading

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