Monthly Update, January 2025
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Recent Program Performance
Soaring Pelican wrapped up a strong 2024, posting a 1.24% return for December, bringing the year's total to a solid 11.74%. While performance slowed in January, it remained positive with a 0.91% return. Since the significant sell-off in December, new volatility has entered the market, benefiting our intraday trading. However, overnight trades have encountered challenges as the market waves have grown larger. Our systems are designed to self-correct for this, but they tend to react rather than anticipate. Over time, we may find ourselves riding those bigger waves (forgive the optimistic surfing analogy).
The Big Picture
This year, the much-anticipated Santa rally didn't materialize as expected, and what started as a smooth, low-volatility climb has now led to significant market fluctuations. This shift could be signaling the formation of a long-term peak. As of now, market technicians are identifying a clear double top in the indices. While this doesn’t necessarily mean the trend has reversed, a failure to push higher could lead to sideways movement or even counter-trend corrections.
It's important to note that all indices are still holding above the 200-day moving average, a key metric for many analysts. However, other indicators are raising concerns. Notably, the number of stocks reaching new 52-week highs continues to decline. While price trends haven't yet started to fall, for now, the market seems to be stuck in a sideways range.
Our Outlook
Good news—high volatility and sideways ranges are ideal for our strategy. The challenge arises when the market sees large overnight moves, but overall, opportunities are plentiful. If the market breaks lower out of its current range, there's a strong possibility that the more-than-two-year uptrend has come to an end, potentially leading to a major correction. From our perspective, this is still positive, as we stand to benefit from a selling environment.
Best wishes from us to you in the new year.
Sam Beckers and Dario Michalek
Soaring Pelican, LLC
805-322-7393
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PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. FUTURES TRADING IS SPECULATIVE AND INVOLVES A HIGH DEGREE OF RISK.
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