27.12.24 - Hefty swings amid low volumes

The holiday season brings thin trading, and the Nasdaq is swinging wildly - 1% moves up or down - despite low volumes.

Markets: US tech stock index Nasdaq is currently down more down 2% intraday. The index has been experiencing significant fluctuations, with moves exceeding 1% in both directions during recent trading sessions.

My View: Today’s 2% drop underscores how small trades can amplify volatility in a quiet market. These moves stem rather from technical dynamics, not fundamentals, as reduced liquidity leaves the market vulnerable to outsized reactions. As outlined the days before, investors should be a bit more cautious; these swings are seasonal quirks, not opportunities. For now, it’s wise to watch from the sidelines, not adding more risk to the portfolio and focus on the new year ahead.

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