After Sharp Bounce, Market May Take A 'Breather' On Lingering Election Uncertainty, Virus Outbreak

[Option Beast]( 11/07/2020   |   [View in browser]( --------------------------------------------------------------- [After Sharp Bounce, Market May Take A 'Breather' On Lingering Election Uncertainty, Virus Outbreak]( Investors will be watching election developments in the week ahead, as well as the surge in coronavirus cases. Analysts say after the post-election rally and because of the uncertainty, it would not be surprising to see the market take a breather. There are earnings from McDonald's and Walt Disney, as well as dozens of others. [More...]( SPONSORED CONTENT [11-Hour Options: The Ultimate Income Trading System [Free eBook]]( In this eBook, Dave shows you exactly how he, and other traders, enjoy a 94.8% win-rate over the last 727 trades by focusing on high-probability trades. You're typically only in the trade for about 11 hours. And the goal is to make 4%, 5% or 6% on each trade (average has been 5.3%). 5.3% may not seem like a lot. But when you win 94.8% of the time, it adds up quickly! [CLICK HERE for instant access.]( [REFLECTIONS... The Eagle Has Landed by David Sager](#) The stock market 'freaked out' this past week - investors wondering what hit them. The Dow Jones Industrial Average tumbled 1833 points, or 6.5% to 26,501, while the S&P Index declined 5.6%, to 3269 and the tech heavy Nasdaq Composite fell 5.5% to 10,911. The week began with a 2.3% drop, its worst day in six weeks, as investors gave up on a stimulus package before the selection. The Dow dropped another 3.4% after the U.S. Covid-19 cases spiked and European countries began getting serious locking down. Even a smattering of strong earnings didn't help. Big Tech stocks tumbled on Friday after the 'big boys' reported late Thursday. All in all the indexes closed the worst week since March. Pick nearly anything, and chances are it had something to do with the market's noteworthy correction. Fear of catching Covid-19, fear of an unruly presidential election? Afraid the economy is heading for another slide? The stimulus package appears to have died after the Senate voted to confirm Amy Coney Barrett and promptly went home. Maybe the markets had a fear of upcoming Halloween, given the speed that the markets sold off! The market simply decided after several weeks of whipsawing that 'these things' were suddenly to be feared in a different way and the realities were maybe looking real, and the selling commenced. "Uncertainty is ruling markets and when in doubt, investors are derisking portfolios by stepping to the sidelines, hence the absence of a flight to safety in....bonds '', explains Canaccord Genuity analyst Martin Roberge. What's strange is everything seems fundamentally OK. Jobless claims fell to the lowest level of the crisis, third quarter domestic product grew at an annual rate of 33%. Add in Friday's announcement that personal income grew by 0.9% in September, and personal spending rose 1.4%. "Right now, we are bracing for more rough days ahead, but we're feeling good about the earnings outlook. Earnings can help drive the market after this particular storm, too," says Lindsey Bell, chief investment strategist at Ally Invest. Fed Chief, Jerome Powell, a true steady eddy amidst these turbulent times Tuesday's Election will be a critical moment for the nation. But for investors that are nervous about the outcome Federal Reserve Chairman, Lerome Powell just might be the most important man in Washington. This man, the Washington leader has done more to stabilize the U.S. economy and steady markets, will go about his business as usual, solid as a rock. For investors, Powell is arguably a more important figure in Washington than who ever wins the election. Facing the pandemic-head on, Powell slashed interest rates to near zero, opened a large bond-buying program, deployed new lending facilities and literally went far beyond what any Fed had done in the post. His major goal is to return the Fed to 'normalcy', quite possibly a different Fed in a post Covid-19 world. He is truly a man of enormous foresight. Guns and Ammo: demand for guns and ammunition is near an all time high, showing no signs of abating, regardless of a Biden or Trump win. The recent skirmishes of civil unrest, sadly is the common denominator. Background checks have exploded as of October, the seventh straight month of more than a 50% upsurge in requests. In early April Barron's advised investors to bullishly look seriously at the major purveyors of firearms and ammunition because so many people were afraid of civil unrest. At that juncture the surge was not part of the national dialogue. Now those fears have materialized, and the demand for guns and ammo are building momentum. Aggressive investors who see opportunity in this sector might want to focus on 'calls' as the leverage looks very positive in the shorter term. RUMBLINGS ON THE STREET Edward Yardeni, an economist and president of Yardeni Research, Barren's Mr. Yardeni speaking about Federal Reserve Chairman, Jerome Powell. "He's done what he set out to do, and (shown a willingness to) change his mind depending on what the situation demands but not be totally inconsistent. He's a pragmatic pivoter." Peter Hooper, Deutsche Bank's global head of economic research, Barron's "The very way (Powell) handled the criticism from the White House was telling about him as a person-that he didn't sway." Jim Hemphill, president and chief investment strategist at TGS Financial Advisors, Barron's Mr. Hemphill says that rock-bottom interest rates make stock valuations appear more reasonable. But he likens the current atmosphere to the late stages of the 1990's tech bubble, when new investors were pouring into the market and buying profitless companies' shares simply because they were rising. "There is a nontrivial chance that something bad happens over the next couple of years," says Hemphill. "And we're just not getting paid well enough for the potential downside." David Osborn, president of Osborn Williams & Donohoe, in Cincinnati. Batton's "Long term, our view is that equities are still the best place to be-especially considering the current fixed-income environment, current low interest rates and the potential for rising rates at some point down the road could lead to negative returns in bonds in real terms." [10 Best Marijuana Stocks to Buy for 2021]( Investors keep waiting for marijuana stocks to come to life. In 2020, the Prime Alternative Harvest Index, which covers many of the major global cannabis companies, hasn't been good. It's off by more than 37% through the end of October, so it's likely that a fuller rebound of cannabis stocks will have to wait until 2021. Marijuana investors are used to waiting. The index got its start on Dec. 18, 2017, and except for some excitement in September 2018 and spring 2019, it has mostly failed to deliver for investors. But could 2021 be the year? [Article continues...]( [15 Money Moves to Make Now to Prepare for 2021]( Take these financial steps before New Year's Day and you can save on taxes, improve your credit, fine-tune your portfolio and boost your retirement savings. Here's where to start. [Click to continue reading this article...]( [This Is What Your Social Security Check Will Look Like Next Year - And Why]( You think the presidential contest is controversial? Try discussing Social Security's cost-of-living adjustment. I should know, because a year ago I devoted a column to discussing the pros and cons of various ways of calculating Social Security's COLA. In response I got more angry emails than to virtually any other column I'm written over the last two decades. Perhaps foolishly, I am focusing on this topic again. The occasion is last month's announcement that Social Security's COLA for next year will be 1.3%. Many reacted with immediate outrage to the announcement. As usual, however, the controversy created more heat than light. [More here...]( SPONSORED CONTENT [65 Year Old Grandma Humiliates Wall Street's Top Traders...]( They laughed when this backwoods grandma taught herself how to trade options for income. But she's got the last laugh now... and she's sharing her #1 tip for FREE! [Click here for instant access...]( --------------------------------------------------------------- [Option Beast]( Send this to a Friend. [Click here.]( | Not a Subscriber Yet? 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