Stocks Pricing in Economic Turmoil

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We knew the rally was suspect if you went through our videos few days ago. Markets going up on low volumes to the upside, not enough conviction from institutional buyers. Than one day when you are happy and feeling giddy, they come in from the backdoor and mow you down.

Slam! You wake up rubbing your eyes, the market gaps open, down 300 points and takes away all you money . You can either sell it or sit in a horrible mess, not knowing which way to go. There is no way out.

This is August, the worst month to trade historically. Most fund managers are gone or parked at Martha’s Vineyard, like our President Obama, and enjoying a double dip Martini. The President officially goes on vacation in August, and we dont blame him but look at the timing. Maybe he is busy, looking for fresh wars in Syria or someplace else to go. We can’t be sure what is happening there. The country is lacking a leadership role and things have gone from bad to worse in the last six weeks. The stocks are pricing in the turmoil.

Meanwhile we are having a double dip recession, things couldn’t be any worse since 2008. Economy is directionless and there is a leadership vacuüm and Europe is coming apart at seams. President and Congress are absent and so are the big players and the shorts and bears have taken over. Bears are out in full force, and they are having a full time orgy at the cost of mom and pop traders whose IRA and retirement accounts are being pummeled to death. I can see trillions of dollars wiped out. Its a complete turmoil.

This is a brutal game, trading can be brutal at times. So  what can you do?

You are doing it already. Staying in cash, sitting on the bleachers and sipping a Martini or if you can’t afford a Martini have a beer, make sure its cold and not sitting in the sun. That is what the smart money is doing, sitting on the bleachers and shooting in the wind like me. They are writing about the stock market without risking anything of their own. It’s summer you know, we need a day off here and there.

Those of you getting anxious because we are not churning out daily trades and trading every day, should know that you are in the sweet spot now, and not a lot of pain, like most others, who ventured out in bad markets and got killed.

You are subscribed to us and reading it right here , and not having any losses !

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