Market is getting more worried after this massive, unexplainable up move that has professionals dumbfounded. We keep grabbing winners week after week in my elite trading service, Volatility Edge. Join us and not have to worry about protests, trade deals and Covid.
This week there has obviously a lot of unrest in the news.
After the weekend the markets opened up overnight down about 1%.
By Monday’s open the S&P 500 was up on the day.
The S&P 500 has been up, every day this week.
The S&P 500 is now up 100 points this week.
How is this possible?
How can we have protests all over the country, to the point that cities have had to implement curfews, yet the market is green this week?
The answer lies not in what is happening now, but what is happening in the future.
The protests will end.
The burning red rage will start to dull and the terrible headlines will stop.
Hopefully, there will be positive changes.
Sad to say this, but the stock market’s returns probably do not depend on the outcome of the last week.
Without comparing the two protests, many might recall Occupy Wall Street.
This was an organization that was loudly and directly protesting the excesses of the financial sector.
They brought the protests RIGHT to Wall Street, LaSalle Street, and every other major financial district in the country.
Yet, they had almost NO effect on the stock market.
If we did not have CV-19, a VIX of 80, a 35% sell off, a roaring rally, and 1939-esk unemployment, I believe the market would have sold off some of the protests.
But, remember what is going on around these protests.
While to me personally, there is no bigger story than what is going on around me.
To the stock market there is, the Covid Recovery.
The market is pricing for a rip roaring recovery.
Optimism is high for the economy, that seems to outweigh everything else.
So what is the lesson here?
Sometimes what you WANT the story to be…is not the story everyone else is TRADING on.
As much as I would like the markets to have some type of connection (from a price perspective) to the protests…
If I try to make that happen:
I will lose.
The only story that matters, is what the market is paying attention to, not what I am paying attention to.
By acknowledging that, one can put what has happened this week, and profit from it.
Your Only Option,
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