The Stock Market indexes have bounced from the abyss yesterday about 2 hours before the close. Today 30 min before the open they are hovering around the unchanged mark.
Most everything is flat except for the U.S. Dollar +.35% and GOLD +.77%.
To me, this is a neutral premarket bias. Without news today I suspect any downside today will be limited.
The Stock Market is getting more oversold by the day. But the last day bounces have prevented me from starting a mean reversion trade.
We took a swing trade in YEXT yesterday for breakeven. It was a good example of when a swing trade does not start working you just sell and wait it out. After we sold YEXT was off as high as 5% yesterday.
You can save yourself a lot of grief following this one simple rule.
If I see another swing today I will put it out and also give some ideas on how to manage it.
Every morning is busy for me as I trade quite a bit now the first 2 hours of the day. So I do not have the time to send out all the trades I make. But I do have the time to send out 1 or 2 that look the best at the time.
These are on @rickjswings. It is my private trading twitter feed. And the best part it is free. But remember, you get what you pay for 🙂
Things have quieted down a bit today on the U.S. political scene. It looks to me like the Democrats are in shock how their trashing of Kavanaugh has backfired.
They took a high-risk gamble to delay the Supreme Court vote until after the midterms and lost. And they lost big.
What was an almost certainty in taking back the House has now become close to a coin flip? When 538 starts talking that way, you know the Dems are in trouble.
What is also interesting about all of this is, the Dems have taken a situation where they had an almost certain chance of taking the house by just taking the normal road.
To me, it appears as they have self-destructed for no good reason. The odds of retaking the Senate were slim. So putting it all on the line for delaying the vote was a bad strategy.
Not to say the moral aspect of the strategy. They have managed to do the impossible. Alienate independents and moderate Democrats. Sure their left wing are still screaming for blook, but it appears it is going to end up being the blood of the Democrats in the Midterms.
Saying all of this, 30 days is a long way to go in politics. But the Democrats seem to be doubling down on this terrible strategy by now running on impeaching Kavanaugh. Whoever is giving them political advice needs to be fired.
Now as to the markets, this means more volatility as the dysfunction in D.C. rises into the midterms. Add this to whatever other October surprises Trump has in store for them and it does not look good for the Dems.
If it becomes clear that the Republicans are keeping both the house and the Senate, I expect a monster rally. Be prepared for this possibility as this will be an opportunity in the markets that do not come along very often.
One that is predictable with a high degree of reliability.
If your trying to figure out where the Dems stand in the political races, just watch the odds. 6 to 4 to take the House and 9 to 2 that Republicans keep the Senate.
Remember these are based somewhat on polls. The rule to me is you can add five to ten points to a poll on the Republican side to get a better view of where things are.
That means on odds that if you are seeing 6-4 to take the house, it is no more than even money.
If you are a liberal reading this, remember, I am not giving my political views here. I am just laying it out as I see it. And if it gives you comfort, I am wrong occasionally🙂
I received an email asking what to attribute this drop in the markets too. Its never easy to figure that out but to me its a combination of the FED, Trade, and seasonality.
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
RickJ’s Handicapping Picks