It had to happen the rally that we have seen since the election is producing a gap down. Imagine that:) Its not much of one, only 1/4% as I am writing this.
And finally for now demonstrations across the country are diminishing while Soros meets with many of our political leaders on the left to discuss their next strategy in the never ending political battles.
I do not know about you but I am tired of this ideological struggle that is pulling our country apart at the seams. It is not good for the people of this country to have to go through the battles that are being fought for our hearts and minds so that the government can tell us what we need to believe is good for us.
I am a strong proponent of individuality. All ideologies do is try to lump together concepts and insist you either follow them or your not on our side. Some of the concepts you might agree with but as an individual there are many I am sure that you do not agree with.
It gets very bad when you can listen to a person being interviewed and with 100% accuracy be able to tell which party they support by what they say. Yes, 100%. Now, that is not the way individual thinking is supposed to happen.
As an example whether you lean toward Democrat or Republican there should be issues on both sides you agree with and others you do not agree with. If you find yourself agreeing 100% with either side you need to step back and do some deep introspective thinking.
I only bring the above up as the above is what is causing this split in society that in turn is indirectly effecting the markets. Markets do not like uncertainty. As you could see by the deep dip we took prior to the election it was the uncertainty that caused the volatility not the idea as to who would be the next President.
If Clinton had won I have no doubt the markets in the short term would have rebounded strongly.
It appears that just perhaps things are settling down a bit. But I also suspect there will be severe flareups as we move forward and there is confrontation on a variety of issues with a new administration that has different ideas then the last. Already we are seeing battle lines drawn on the issue of sanctuary cities. This is a battle that is going to be fought as soon as Obama is out of the oval office.
It’s an interesting battle as its the Federal laws vs the cities rights to have laws independent of federal law. In many of these cities ordinances have been passed making what they do legal irrespective of the Federal laws.
This has the potential to be a big market mover. If the Federal government ever gets to the point of cutting off funds to these cities expect a sharp drop in the markets. Many of these cities already have severe financial problems with their retirement funds and bonds. Depending on how many cities might be effected it could have the effect of throwing the U.S. into a recession.
This is the big one right now to keep a watch on. There will be others but this has the potential to spiral out of control. One way to keep an eye on this would be to keep an eye on the bond ratings of the various cities involved.
Those are my thoughts for this morning:) I never have an idea what I am going to write about when I wake up so its merely a free flow of thoughts as I approach the trading day.
I am long a basket of stocks and looking to get longer. Mid November marks the beginning of the strongest period historically for stocks of the year. Historically this lasts into January while still maintaining a tail wind until may 1. I will try to take advantage of that. Its never as simple as it appears to be to say the least.
Today I expect this pullback to be minor with all indications of a rally to new highs and higher through year end. If there is ever a time to gamble in the markets we are at that period now.
Today I will be taking breakout trades with liberal stops as opposed to the Breakout day trades I have used from may until Nov. 1. Mean reversion short trades are off the table completely for now.
If you want to follow some of my trades along with my thoughts typically given after the open you can go to @rickjswings. 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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