Saturday, September 9th, 2017

Market Crash?


Well I was wrong, assuming we are putting in some kind of bottom. It never ceases to amaze me what happens these days. This market is unreal and unusual. After the Fed rate cut the market nose dives 678 points and ends up below 9000 levels for the first time since 2003. Both DOW and SPX crashed 7% down. Broader index also tumbled hard. VIX known as fear gauge shot up 64 points. Highest reading since 1987 or ever that I can find on historical charts. That means there is sever panic and anxiety in the marketplace. Dow has lost more than 2000 points in a cascading waterfall sell off. I have never seen a market crash after a Fed rate cut . Markets have always rallied after a Fed rate cut. Volume was heavy on SPX and SPY daily charts. SPX went down 75 points and NDX 55. The damage was limited to NDX and major other Tech companies. Higher VIX futures are at 52 and that tells a lot about the markets condition.

We have been advocating cash positions since September expiration and it seems as a fine to be, unless you are a day trader with sharp skills and nimble enough to get in and out. Traders were making money in SKF, QIDS, UYGS and others. Many people I know have been doing it daily like a fisherman that goes out to sea, and comes back home back to the harbor at the end of the day.. Some have made quite good returns. But this type of trading is not what we do here and its unsafe by any means.

Dow weekly chart  2003-2008

Dow weekly chart 2003-2008

It seems like as if money is leaving our markets in an orderly fashion. Major investors are pulling out of big investments and there is an orderly trait in all of this. Every 500 point drop wipes out approximately a Trillion dollars in market cap. These huge drops have wiped out 3 to 4 Trillion dollars of national wealth in just 7 seven sessions. These are historic times and times that will be remembered for a long time to come. The sad part is many Americans pension funds, 401Ks and retirement accounts are obliterated in all of this. Its a very sad situation.

Looking at major stock charts of GOOG which is at 329, AAPL 88 , FSLR 118, POT 91 and CF at 56. These charts have been severely damaged, and it may take months before proper bases can develop and they become trade able and safe to trade and invest.

Its best to stay in cash on the sidelines and watch and observe. Let us know what you think…
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Comments

3 Responses to “Market Crash?”
  1. Крутотень!

  2. I really like what you had to say here! It\’s about time! Would you mind if I placed a link back from my blog?

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  1. […] donot lead to bull markets and 20% of these follow through days fail as we saw last year in the stock market crash 2008. There were few follow through days, but the markets went nowhere, as waves of selling created […]



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