January 28, 2023

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The graphs indicate that Santa Claus's march is still on

The graphs indicate that Santa Claus’s march is still on

CNBC’s Jim Cramer said Monday that there may be an opportunity to buy the stock ahead of a potential rally.

“The charts, as interpreted by Larry Williams, suggest Christmas isn’t going to be canceled on Wall Street – he thinks we still have a Santa’s parade coming, and the perfect time to buy is sometime on Thursday,” he said.

Stocks fell for the fourth straight session on Monday, weighed down by mounting recession fears.

The recent market downturn, Cramer said, is the perfect setup for the Santa Claus rally, which describes the tendency for US stocks to rally near the end of the year and the start of the new year. For Williams, it’s a matter of when, not if, stocks will rise, according to Kramer.

To explain Williams’ analysis, he examined the daily chart of the S&P 500 futures contracts from November 2021 to January 2022.

The blue line at the bottom is Williams’ seasonal forecast, and indicates that the best buying opportunities come in mid-to-late December, with Santa Claus still bullish until January 10th. The chart shows that stocks rose from December 20 through the end of the year. End of the year, in line with expectations.

Cramer then compared these results to data shown in a daily chart for Standard & Poor’s futures contracts from September of this year to date.

The chart indicates that the market has just entered the “seasonal sweet spot,” Kramer said. He added that Thursday’s trading session would be the perfect moment to buy ahead of a potential rally, according to Williams.

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“I know it’s hard to believe the market is ready to run, but that’s always the case with Larry calls. Although this year could have been different, betting against it was a really bad strategy,” he said.

For more analysis, see Kramer’s full explanation below.

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