The second trading day of December opened strong, but the real question is whether the rally can sustain itself or if this is just a classic early-month bounce before volatility returns.
The setup for December is still supportive. Real yields have softened, liquidity has improved, and fund managers who underperformed in 2025 are chasing returns into year end. Seasonality favours strength when November ends weak, and the market has followed that script so far.
For me, I am watching two themes very closely:
1. High beta tech
If Nasdaq holds above 23000, a melt-up is still possible. Mega caps like MSFT and GOOGL continue to pull the index higher. Their strength decides if December closes green.
2. High conviction small caps
Names like RZLV, RGTI, and CRCL still have asymmetric upside due to catalysts in AI agents, quantum computing, and crypto infrastructure. Once liquidity rotates down the market cap chain, these can move fast. I am also watching NOK as a defensive AI telecom play.
If the rally broadens beyond mega caps by mid December, we could see a proper Santa move into year end. If breadth weakens again, this bounce may fade.
My December plan is simple. Add on dips with real buyer interest. Avoid crowded trades. Protect gains but stay opportunistic.
What is your strategy for the final stretch of 2025?
Not financial advice. Trade wisely, Comrades!
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