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Thursday, August 15, 2019

Market Update August, 15th, 2019 - The August Swoon - Part 2

I ran out of time today, because I like to get these daily market update's completed, before the opening bell, so here comes part 2. If you missed Part 1, here's a link...

Quick update on this mornings action: 

We saw a little pop on better than expected earnings out of (China - trade dependent) Walmart, and good retail sales numbers. I thought China trade was an issue? Where's this "recession", every news outlet in the country was seen pushing, yesterday? Not just CNBC, & CNN, but every TV, and radio station!  "Biggest One Day Drop Of 2019", that's not saying much, and how does the constant fear mongering help the average investor?

Every time the market goes down, it's Trumps fault, and if there isn't a Trump tweet that can be blamed... then pull out the old "inverted yield curve" story, and run super-bearish reports (reruns) on your network at night. 

“CNBC Special Report: Markets in Turmoil” Airs Tonight at 7PM ET

Anything to try win an election, I guess, and Trump's right when he calls the Fake News Media, "The Enemy Of The State", and your pocketbook! 

Getting back to the real news:

Corn - yes corn! The little rows of yellow kernels, that grow on a cob? 
I'm not suggesting you should trade corn, but at least you can eat corn, unlike another yellow commodity, that rhymes with "mold", and this pattern may look familiar to you, if you've been following my Gold charts. I think no investor should own much Gold, and certainly not 10% of your portfolio, but I'll leave that to the financial professionals. 


We continue to build a base, as the $VIX remains above 21.50 support.  Yes, it's that simple, and if only there was a $VIX for every index..!

I noticed the DOW broke the 200 day ma, so we're probably seeing some program selling.

Remember what I was saying about watching the long term charts this morning. Anyone can watch the daily moving averages, and I shouldn't even have to alert to something so simple.

What's really significant, is that we're seeing support come in on the $NYSE! 

$NYSE - Daily Candlestick Chart 2 year view

That chart has been sitting in my Public Charts area for a week, and shame on you, if you haven't been paying attention!

Random Stock: 

$GE - down 12%

During all the time I was on twitter, did you ever once hear me suggest anyone to buy $GE stock? Uh, no, not even for a trade! Not even on a false breakout!

 How is it that my charts work so well, while investors consistently lose money calculating PE ratios, and listening to cable news shows? I see major support taken out on a bad earnings support, on a stock like Boeing (for example), and just have to shake my head. Trend lines are not that difficult to draw, and you can see what happens when they break. You can't ignore technical patterns in 2019.  

 Begs to question: Are people really this stupid? I think we are a becoming a, "Nation of Idiots", but I also think when folks hear people say things like, nobody can time the market; they give up too easily. This is hard work, and it takes more time than most traders are willing to invest. I've had my nose to the grind stone for over 10 years, and still making huge discoveries! 

A word of caution 

Not that I'm the least bit worried about the market at these levels, you can never be too careful.

Volatility remains high, and with the volume as light as it is, you could see a situation where volatility spikes, and there's no bid under the market. That's a recipe for disaster.

I'd would just tell you to trust the $VIX, and the long term charts.

$SPX DCS Chart. Key support (2622) tested last week. I don't see that breaking any time soon, but If that happens there's support at the 200 day average, around $VIX 29. 


One last thing I wanted to mention, was that John Nagarian, had some very insightful observations, on Fast Money (I think I was watching...), yesterday. He said, he saw a lot of  PUT buying yesterday, and a lot of buying of the August $VIX 30 strike, and Gold. He's smart enough to see this as a contrarian indicator, and tried to warn people, and that he sold his position in $GDX. I may not agree with most of his calls, but he has more experience than I do, and I gotta respect that! 

Take care, Traders

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