Charts suggest the S&P 500 will rally in December, Jim Cramer says

CNBC's Jim Cramer said Monday that stocks successful the benchmark S&P 500 volition apt rally adjacent month.

"The charts, arsenic interpreted by the legendary Larry Williams, suggest that the Santa Claus rally is coming to municipality adjacent period and you've got to get acceptable for it, oregon other you whitethorn beryllium near behind," helium said, referring to the marketplace improvement successful which stocks summation adjacent the extremity of the year.

Cramer pointed retired that Williams said astatine the extremity of October — which marked a large period for stocks this twelvemonth — that stocks could rally done the extremity of 2022. "Since past we've had a precise bully run, truthful arsenic we get person to the holidays, we've got to ask, tin it continue?" Cramer said.

He archetypal examined the regular illustration of the S&P 500 to explicate Williams' analysis.

The bluish enactment represents Williams' exemplary of the index's seasonal pattern, oregon successful different words, the mode it historically has traded astatine immoderate fixed constituent successful the year. The signifier tends to beryllium bullish for stocks done the extremity of the year, meaning that the market's caller spot could beryllium acold from over, according to Cramer.

"Williams points retired determination tends to beryllium 2 saccharine spots for the S&P astatine this clip of year: The archetypal runs done precocious November, the 2nd runs done mid-to-late December," helium said.

Cramer besides analyzed a illustration of the S&P 500 that shows Williams' short-term rhythm forecast successful red.

If this rhythm plays retired again, arsenic it has successful caller years, past stocks mightiness autumn done the extremity of November. However, there's a accidental that the S&P 500 could soar successful aboriginal December, according to Cramer.

"Between the seasonal signifier and the short-term cycle, and besides the highly affirmative semipermanent rhythm that we covered a fewer weeks ago, he's seeing a batch of greenish lights to commencement buying," Cramer said.

For much analysis, ticker Cramer's afloat mentation below.