The Stock Market is continuing higher this morning, but a caveat here. Powell is set to testify soon, and President Trump meeting with the President of China Friday.
Both of these events could easily set up a reversal to the downside. At least for a quick move if not a resumption of the slide we have been seeing.
I talked a bit about trading the news yesterday. It would not be unreasonable to take a short position just prior to Powell testify for a short swing to the short side.
However, be sure and have a stop in mind in case he says something unexpected. Like, we are now considering lowering rates:)
I exited my 1/4 position I had left in SPY via SSO after the close yesterday for a loss. The exit triggered and I took it. That’s the way it works.
Right now, for me, it is waiting and see. I might take a short trade this morning. But I am not going to commit to it just yet.
Other than that its the same old thing. Republicans now have cemented a 53 seat Senate. Flake and Corker will be gone in January and some Pro Trump people will take their place.
This will give Trump some breathing room, but, you have Romney coming in, Murkowski, and Sasse. None of those 3 will be Trump supporters. That brings us to 50, and then you have Collins. A tough one, but, as far as I am concerned she proved herself on the Kavanaugh vote.
She might disagree with Trump from time to time, but her integrity as far as I am concerned is intact.
In short, despite a 53-47 Senate, Trump still will not have an easy time of it. The biggest problem I see will be getting an effective AG in place. That is the last thing the Senate wants is to have an AG that is going to bring law and order back.
I may be a cynic, but despite Trump single handily saving the Senate for the Republicans, I doubt they will repay him in kind and give him his AG of choice.
That, unfortunately, is just the way things work in D.C. Preserve the Status Quo at all costs.
The House, on the other hand, will be a nightmare. Not only for Trump but for the Country. If you think the resistance was bad in the first two years, you have not seen anything yet.
So who do we have to blame for the predicament Trump and the Country find itself in? As I see it
#1 Sessions. He oversaw the DOJ when abuses of power have occurred never before seen in U.S. history. Instead of cleaning up the DOJ, and putting an effective team in place, he allowed the Democrats to keep control of the DOJ. (for 2 years). And then to top things off allowed a Special Counsel. I do not see how he could have been any worse.
#2 Ryan He did nothing to help Trump. And one could easily argue he was instrumental in turning the House over to the Dems.
You might ask, what does this have to do with the markets? Well, you got a glimpse over the last few months. If things go off the rails, the market is heading south, it is as simple as that.
Meanwhile, the Fed, oblivious to the risks, paints a rosy view without considering the risks as I see it.
That’s my view for what it is worth. You can ask 100 people that follow the markets and they will all have different perspectives. Not only because they view things differently, but also because many let their political bias get involved in their analysis.
Be careful right now investing. Do not get stubborn.
That is why I like swing trading. Usually this time of year I would be building a six-month portfolio to take advantage of the best six months of the year. But this time, I am going to take it a bit slower.
I should be around on Skype this morning, or also my private twitter feed if anyone has any questions.
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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