PickAlpha Evening Insights | 2025-12-24 - Three Trades For Tomorrow
• Stocks mixed as rates ticked on smaller-than-expected jobless claims and thin holiday liquidity. • No major after-hours headlines; markets remain in post-close quiet. • Three Trade Ideas.
Market Wrap
Market Recap — Markets finished muted into the holiday close after a holiday-shifted Labor Department release and a high-profile insider buy. Initial jobless claims dipped to 215k while continuing claims rose to 1.950mn, a mix that nudged front-end rates and real-yield dynamics. Nike jumped after a filing showed Tim Cook bought 50,000 shares, and U.S. equities operated with reduced liquidity ahead of an early 1:00 p.m. ET close. Energy-data timing shifts were noted as the EIA schedules the next petroleum report for Dec. 29.
Intraday — At 08:30 ET the Labor Department reported initial claims fell to 215k and continuing claims rose to 1.950mn, a mixed labor snapshot that influenced short-end rate moves; EIA pages at 10:30 ET flagged the next Weekly Petroleum Status Report for Dec. 29, potentially leaving a short visibility gap for crude/product positioning; markets also priced in an NYSE early close at 1:00 p.m. ET, and at 13:22 ET Reuters reported Tim Cook bought 50,000 Nike shares, helping push Nike about 4.6% higher into the shortened session.
After Hours — No material after-hours developments were reported in the payload between 16:00–20:00 ET; trading remained quiet with holiday-thinned headlines and no earnings cluster or policy shocks.
Three Trades For Tomorrow
1/3 Short $SPY — At the next US equity cash open after the Christmas closure (09:30–09:35 ET), if $SPY opens ≥1.5% above its prior close, short at market; target a 0.8% move back toward the prior close by that day’s 16:00 ET close; hard stop 0.7% above entry.
The full US equity market closure for Christmas can concentrate two days of news into the next open, creating outsized gap-up moves in $SPY. With no intraday cash trading to adjust positions, an overextended opening gap is likely to attract profit-taking and mean-reversion flows into the close.
Trade credibility: actionability 8.0 | timeliness 8.0 | clarity 8.0
2/3 Long $TLT — At the first regular US session after the full fixed-income closure, if $TLT opens ≥1.0% below its prior close, go long at market within the first 10 minutes; target a 0.7% rebound by the same day’s 16:00 ET close; hard stop 0.6% below entry.
SIFMA’s recommendation for a full US fixed-income close, following an early close, concentrates cash Treasury risk into futures and ETF hedges. This often leaves $TLT vulnerable to overshooting lower on reopening as hedges are unwound, creating a tactical opportunity to buy a sharp gap down for a partial reversal.
Trade credibility: actionability 7.0 | timeliness 8.0 | clarity 7.0
3/3 Long $FEZ — At the first US session after the Christmas closures in London and Paris, if $FEZ opens ≥2.0% below its prior US close, go long at market within the first 10 minutes; target a recovery to no more than 1.0% below the prior close by that day’s US…
Christmas Day closures across major European exchanges compress multiple sessions of Eurozone news into the next joint European/US trading day, which can produce exaggerated downside gaps in $FEZ. Once underlying cash markets reopen and liquidity normalizes, extreme gap-downs often partially retrace as risk is rebalanced.
Trade credibility: actionability 7.0 | timeliness 8.0 | clarity 7.0