The stock market is up slightly this morning an hour before the open. The Nasdaq is leading at +.35%.
Of note, metals and oil are lower with the rest of what I look at in the morning Green. Financials, IBB, U.S. Dollar are all in line with the gains in the stock market.
Overall, seems like a neutral to neutral + bias this morning.
The markets have settled down from the overnight highs which is not surprising considering how the stock market has quickly become overbought.
I have one trade left in my mean reversion trades. UNP I purchased on 2/28th 133.39. The stock took a dip but now is trading at 137.28. It hit the exit trigger on the close on Friday so I plan on exiting this morning.
As far as new trades its going to be difficult to find any new mean reversion trades with the markets overbought. There are several bottom reversal trades I am considering but nothing has triggered so far.
As far as risks, there are plenty. It seems like I am a broken record when it comes to the risks of this market but they are not going to go away anytime soon.
The political divide in the U.S. will guarantee that they remain and on steroids. And the problem is our political class along with the obedient media is dividing the U.S. population to two extremes. You have the “resistance” on one side. Its made of most of the Dems and some on the Republican side. Its fueled by the dislike of the President.
Then on the other side, you have the MAGA people, where supporting the President has become a religion of sorts. And the MAGA movement is getting steam not only in the U.S. but in other countries as well.
My question is where are the people in the middle? Are people so easily manipulated by the media to be pushed to the extremes?
You see people that you once thought were the pillars of sanity and logic succumb to what you see in the media daily now.
Finally, the people on both sides of the extremes are convinced beyond any doubt that their side is the correct one, not allowing for any reasonable discussion or thought. What they do not realize is this is the very place that the manipulators want them to be. After all, reason and logic would expose both sides for what they really are.
From experience either extreme is the wrong place to be. Certainly, they both have correct and incorrect assumptions. The problem is the extremes are typically fueled by special interests with the intent of manipulating public opinion.
Now I bring all this up not to discourage anyone from being active politically on either side of this battle. But first and foremost if your an investor that you leave your political leanings out of the equation.
To make investment decisions based on what you feel is correct politically will 1. leave money on the table and 2. perhaps assure you to be a negative EV investor.
I have written about this before but an article I read this morning triggered me to write about it again.
A good discussion about leaving ideology out of the equation when you invest.
I have received emails as to what to look for from pundits. Myself I have my own six or so people I read for what is going on in the world today.
But overall you should be looking for people that are not conforming to the spin of the day. People that go against what the people in their group are typically saying.
As an example look for Liberals who on occasion go against the commonly accepted liberal spin or vice versa, Conservatives that go against the conservative spin.
A good example of what I am talking about is this article:
I am not giving this article for the merit of what is written. Only to demonstrate the type of thinking you should be looking for in an opinion based writer.
I have wandered off a bit this morning, but this topic cannot be emphasized enough. In this age of manufactured polarization of the public, it’s important to keep a clear head.
Very similar to being at the poker table when everyone seems to have gone on tilt:) You could be sitting playing poker in a pretty boring slow paced game, but at 2:00 A.M. all of a sudden its like someone turned on a switch and what were passive players are now 3 betting and playing every hand.
And before you know it most of the table gets involved. If you succumb to this your hard earned money that you made grinding it out with solid good play can be gone in an instant.
My words of wisdom for this morning:)
If you want to follow some of my trades along with my thoughts typically given after the open you can go to @rickjswings. Typically I talk about the overall day expected with the markets and also give some levels on the ES and NQ for failed breakout scalping.
It’s my private twitter feed for the stock market and its free. Sports Handicapping is the subscription-based part of this site. But considering the cost of joining it’s almost free:)
Good Luck Today
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