Knowing What January Effect Is On Stocks, A Moment To Repeat Cuan At The Beginning Of The Year

YOGYAKARTA The January Effect moment is always eagerly awaited by investors in the capital market because it can have a positive impact on stocks on trading in early 2024. For those of you who don't know what January Effect is, this is a phenomenon that occurs in stock trading, where there is a trend of rising on stock prices in January.

For more details, see information about what January Effect is on the shares in the following article.

January Effect is the seasonal increase in the Stock Price Index (JCI) during January. Analysts generally link this increase to the rise in stock purchases after the price fell in December.

The term January Effect was first put forward by a US banker named Sidney Wachtel in 1942. Based on the summary he made, since 1925 the price of shares on the US stock exchange has increased in January, more precisely before the middle and end of the month.

Originally, there were a number of factors that caused the emergence of the January Effect phenomenon, including:

January Effect at the Indonesian Stock Market

Although it can provide fresh air for stock trading in the Indonesian stock market, the January Effect phenomenon does not always occur every year.

From 2014 to 2023, the JCI did not get a January Effect several times, such as in 2020 and 2021. In that period, the JCI's rationality moved minus 5.71 and minus 1.75, respectively.

Especially for the beginning of 2024, Phintraco Sekuritas stated that there is an opportunity to gain money at the January Effect moment.

According to them, the JCI successfully tested support on the first day of trading in 2024, namely on Tuesday, December 2, 2024. Meanwhile, the JCI today, Wednesday, December 3, 2023, is expected to move on resistance 7,350, pivot 7,300, support 7,250.

Phintraco Sekuritas said the JCI closed down 0.43 percent to the level of 7272.797 on Friday, December 29, 2023.

"IHSG today has the potential to support 7,250. This is in line with the potential death cross from Stochastic RSI," said Phintraco Sekuritas in his research, Tuesday, January 2, 2024, quoted by VOI.

Phintraco Sekuritas added that positive sentiment in early 2024 came from expectations that the Fed would lower the benchmark interest rate in the first quarter of 2024. CME Fedwatch Toll shows the Fed Rate's 71.4 percent cut probability in FOMC March 2024.

"This triggered the strengthening of the Rupiah exchange rate by 0.13 percent to the level of Rp15,395 per US dollar on Friday, December 29, 2023 afternoon," explained Phintraco Sekuritas.

From within the country, expectations for more positive economic growth in the political year are expected to provide a chance for the January Effect in 2024.

Meanwhile, according to the Capital Sensitive Analysis Index (CSA Index), most investors indicated that market participants were still optimistic that the JCI's performance in January 2024 would be positive. January Effect is a momentum that is eagerly awaited at the beginning of the year and is the driver of the JCI to move in a positive direction.

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