Trump's Election and the Markets

[Kel Varnsen]

Stop losses and Algos turned this into a bloodbath, and no one is buying the dips yet, so expect more selling and more panic. Market 'should' stabilize after the government shutdown is resolved. As I type this...Dow just closed with biggest single day point loss ever. Crazy!

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[Absolute Zero]

"Largest Single Day Point Decline Ever" Per CNN

 

[AsUpRoDiGy]

Yeah ASU prodigy called it although I was surprised at just how bad it was today. At one point the Dow was down 1600, 10 minutes later it was 800 and you thought OK the fools have all sold, and then bam down again finished down over 1100.

The market needs corrections but when it's this fast you get concerned about momentum. Cramer is calling it a "flash crash" where the selling volume is just so high the markets can't handle it and panic sets in.

oddly I was watching Trump speaking earlier and bragging up a storm but he said nothing about a market that was down 675 points as he was talking.

This is pure emotion, coupled with algorithms protecting gains. I expected a 300-400 point loss today, but emotion set in and people started to panic sell. Smart ones are buying the dips right now in small chunks, because it's tough to gauge how much lower it will go with such volatility. Fundamentals are still good, so just as the market went up on hype...it goes down on hype.

 

[Russ Smith]

This is pure emotion, coupled with algorithms protecting gains. I expected a 300-400 point loss today, but emotion set in and people started to panic sell. Smart ones are buying the dips right now in small chunks, because it's tough to gauge how much lower it will go with such volatility. Fundamentals are still good, so just as the market went up on hype...it goes down on hype.

yeah if I had more cash in my IRA's I'd have been buying today but in the 2 I mostly trade in, I'm over 90% stocks right now so not much cash to buy with. Obviously last week and today I took a big hit, but I'm still playing with house money from the prior 13 months so not really worried.

I used to try and get in and out and finally decided the folks here and elsewhere were right, trying to time the market doesn't work.

 

[AsUpRoDiGy]

yeah if I had more cash in my IRA's I'd have been buying today but in the 2 I mostly trade in, I'm over 90% stocks right now so not much cash to buy with. Obviously last week and today I took a big hit, but I'm still playing with house money from the prior 13 months so not really worried.

I used to try and get in and out and finally decided the folks here and elsewhere were right, trying to time the market doesn't work.

Timing the market never works unless you're a MM, and then you're gold.

 

[Beaver]

How much higher are interest rates expected to go? I have been following because we are having a house built and can't lock in our rate until probably March/April.

 

[82CardsGrad]

How much higher are interest rates expected to go? I have been following because we are having a house built and can't lock in our rate until probably March/April.

Most "experts" didn't think we'd be at these levels so soon... The general consensus was that we "might" be a 3% on the 10 Year by the end of the year... Well, we're at 2.85% today and rising fast!

 

[Dback Jon]

Most "experts" didn't think we'd be at these levels so soon... The general consensus was that we "might" be a 3% on the 10 Year by the end of the year... Well, we're at 2.85% today and rising fast!

They should go up at least a full percentage by end of year.

 

[82CardsGrad]

They should go up at least a full percentage by end of year.

Wouldn't be surprised if we're looking at a 4 handle on the 10 Year come the end of 2018!

 

[Russ Smith]

Timing the market never works unless you're a MM, and then you're gold.

yeah the other thing I could have done is buy SDOW or today DXD which is 2 times short and was up 8.92%. Of course again you're still trying to time the market even if you just use it as a hedge. DXD is up about 14% in the last 2 days but who knew that well enough to buy it on Thur?

I certainly didn't.

 

[BillsCarnage]

Stop losses and Algos turned this into a bloodbath, and no one is buying the dips yet, so expect more selling and more panic. Market 'should' stabilize after the government shutdown is resolved. As I type this...Dow just closed with biggest single day point loss ever. Crazy!

Yeah, it's crazy the effect the machines can have on the market nowadays; which is why I don't think people should panic.

 

[Russ Smith]

So early futures were up across the board until the Asian markets opened and tanked. now futures are down about 500 for DOW, was 700. Pretty volatile day tomorrow again I guess.

Oddly the orange dictator is not talking up the market now, I'm fascinated to see how he blames the Dems, Obama, and HRC for this, I'm sure he'll find a way.

In my stock heavy IRAs I was down just over 3% today, which considering the overall markets is about 1.25% LESS of a drop than if I was just in indexes.

A friend of my girlfriends nephew was telling him on the phone today he lost over 100K in paper value in crypto currency overnight. He's still ahead so it's "house money" but he was about to panic sell. The nephew was talking to me and I had to say in all honesty I can't give you a piece of valuable advice, NOBODY knows how cryptos are going to trade in crashes. With the overall market generally speaking you just hang on and eventually it will go back up, might be weeks, might be years but it will eventually go back up. Nobody knows if that's the case with Crypto or not which is why I've been too scared to get into it.

 

[AsUpRoDiGy]

So early futures were up across the board until the Asian markets opened and tanked. now futures are down about 500 for DOW, was 700. Pretty volatile day tomorrow again I guess.

Oddly the orange dictator is not talking up the market now, I'm fascinated to see how he blames the Dems, Obama, and HRC for this, I'm sure he'll find a way.

In my stock heavy IRAs I was down just over 3% today, which considering the overall markets is about 1.25% LESS of a drop than if I was just in indexes.

A friend of my girlfriends nephew was telling him on the phone today he lost over 100K in paper value in crypto currency overnight. He's still ahead so it's "house money" but he was about to panic sell. The nephew was talking to me and I had to say in all honesty I can't give you a piece of valuable advice, NOBODY knows how cryptos are going to trade in crashes. With the overall market generally speaking you just hang on and eventually it will go back up, might be weeks, might be years but it will eventually go back up. Nobody knows if that's the case with Crypto or not which is why I've been too scared to get into it.

China just announced that they might ban all cryptos, which resulted in a mass sell-off. BTC is down below 7k and keeps falling. Would take some miraculously good news for the crypto market to rebound where it once was, and even tough to say where the bottom might be, as bad news just comes out daily about cryptos. Seems the bubble has burst.

 

[CardsFan88]

Here's what happened guys.

XIV blew up. (technically it didn't blow up, it was designed to have a cut off point, which it breached.)

This is what was driving the market for YEARS. This is what I was warning about, the short vol trade (among other risks). Hundreds of billions in shorting volatility.

Whenever the market would go down, someone would short VIX and magically the market would ramp. That's what people have been taking credit for... Obama and Trump. Now we'll see people who don't understand being partisan in the media and nothing will get done.

One thing is for sure, Trump was an idiot for attaching himself to the bubble he inherited instead of sticking to his CORRECT speeches talking about it being a bubble and supporting Glass-Steagall.



People have been making money shorting the VIX, using for instance XIV for years. One guy quit his job and took his savings to 12 million doing this.

http://www.businessinsider.com/form...llionaire-using-short-volatility-trade-2017-8

It's a inverse derivative, created and largest owned by Credit Suisse. You know one of those on the ropes and technically insolvent European TBTF's. Whoops.

Oh, who owns 2nd most? (granted 1/10th of CS) another on the ropes and technically insolvent European TBTF Deutsch Stank. Whoops.

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So you have a ton of people who just lost tons. People posting stuff around. CS and DB have been hit hard. Of course people like this might have to sell everything nailed down to stay afloat.

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We don't even know if anyone has shadow derivative bets on these products or somehow involving these products.


Then you have a situation where if this is gone, the upside pressure on equities created by shorting vol won't be there.



This was AFTER the market closed by the way. So lots of forced selling tomorrow. Idiot Jim Cramer, who knew NOTHING, I mean NOTHING about this XIV, has been taken aback by this all.

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No Jim. They're trading just fine. This is how our markets are SET UP. To allow THIS. This is market structure. Earth to Jim.

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Still shilling

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https://twitter.com/jimcramer/status/960640117382828032

No Jim... it is NATURAL pressure when the market is set up like this. Up is down. Down is up. Black is white. White is black.



https://twitter.com/jimcramer/status/960672294904451072

ROFL

https://twitter.com/jimcramer/status/960700453691580416

Still shilling

https://twitter.com/jimcramer/status/960702071484928000


Then not

https://twitter.com/jimcramer/status/960708953066889216

https://twitter.com/jimcramer/status/960721111200739328




This is why Glass-Steagall needs to be put in.

Clinton repealed it. Bush inherited that crash and rode it till it crashed. Obama inherited that crash and continued those policies and created the biggest bubble in history. Trump inherited this.... and the rest is yet to be played.

Hopefully unlike Clinton, Bush, and Obama... Trump does the right thing. Glass-Steagall.

The previous presidents all pumped this up with their policies and actions. That was THEIR actions in past tense. Their legacy of not addressing the broken system except with money printing. Trump, like them, will be defined for his actions one way or another... if this happens.


We've had three bubbles in a row. This one is the biggest. We're the most in debt. The most destitute. The infrastructure and boomers are 10 years older. So on and so forth.

That said, the markets are so screwed up tomorrow it wouldn't surprise me if they are +5%.

Or this could be it.

 

[Mainstreet]

Unfortunately, inflation here we come.

 

[Russ Smith]

China just announced that they might ban all cryptos, which resulted in a mass sell-off. BTC is down below 7k and keeps falling. Would take some miraculously good news for the crypto market to rebound where it once was, and even tough to say where the bottom might be, as bad news just comes out daily about cryptos. Seems the bubble has burst.

yeah I wanted to tell the nephew to sell his too but that's his decision. I told him that's precisely why I don't buy them, it's more gambling than trading you should IMO only do it with money you can afford to lose.

He's playing with house money too but I'm afraid he is too confident that he truly understands bitcoin, I'm not convinced anybody really does. All I said is if it were me I'd take my profits and get out, but that was why I never bought any, way too volatile/

 

[CardsFan88]

Of course the HFT's love these sorts of scenarios and predictably went to town during this. Another market structure issue allowed to evolve.

Also the crypto currency carnage can't be helping matters either.

Asian markets and Dow futures not doing well

https://www.investing.com/indices/us-30-futures

Dow futures as of now

23,088.0 -850.0 -3.55%

NIKKEI 21184.58

-1497.50 -6.60%

 

[BillsCarnage]

So early futures were up across the board until the Asian markets opened and tanked. now futures are down about 500 for DOW, was 700. Pretty volatile day tomorrow again I guess.

Futures are down 1200 now.

 

[CardsFan88]

Futures are down 1200 now.

FUTURES
Index Close Cur Future Change
24345.75 23095.0

-843.00 FUTURES FAIR VALUE (377.75)
Fair Val Close Cur Future Change
24315.75 23095.0

-1220.75

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[BillsCarnage]

This is why Glass-Steagall needs to be put in.

Clinton repealed it. Bush inherited that crash and rode it till it crashed. Obama inherited that crash and continued those policies and created the biggest bubble in history.

And Angelo Mozilo made out like a bandit

 

[Russ Smith]

Wow I don't know what was worse, 3.5 hours waiting in the DMV for my girlfriend to renew her drivers license, or spending 3.5 hours watching the stock market tank on my phone. Today was my biggest one day loss ever, overall market was bad and one of my stocks fell 30%(total overreaction to mixed guidance). It's almost all in my IRA's so it's not money I'm going to use now but still sucks to watch.

It'll come back eventually, the worst part is i I nearly sold that one stock 3 weeks ago when it got me back to even plus 5%, but I decided not to.

 

[AsUpRoDiGy]

Wow I don't know what was worse, 3.5 hours waiting in the DMV for my girlfriend to renew her drivers license, or spending 3.5 hours watching the stock market tank on my phone. Today was my biggest one day loss ever, overall market was bad and one of my stocks fell 30%(total overreaction to mixed guidance). It's almost all in my IRA's so it's not money I'm going to use now but still sucks to watch.

It'll come back eventually, the worst part is i I nearly sold that one stock 3 weeks ago when it got me back to even plus 5%, but I decided not to.

That's always rough to see. When my positions are down I try to stop looking and go work out or something to keep my mind off of it. As long as you do your DD and focus on fundamentals...you will almost always be fine. Be patient and you will be rewarded!

 

[Russ Smith]

That's always rough to see. When my positions are down I try to stop looking and go work out or something to keep my mind off of it. As long as you do your DD and focus on fundamentals...you will almost always be fine. Be patient and you will be rewarded!

yeah I've completely changed my investment plans over the years I used to try and time the market, get in and out etc. People here several times pointed that out to me.

Sounds funny but I finally talked to someone at work who told me the same thing and showed me stats on getting in and out and how you almost always miss the big up days doing that. I paid for a one year Motley Fool Stock Advisor, bought a bunch of stocks they recommended that have for the most part done well(until the last 2 weeks) and it has completely changed my philosophy. They very much preach the buy and hold long term plan and that's the way I'm going now.

Every now and then I'll sell a stock I don't like anymore but nothing like what I used to do.

Today went much better although we closed off the lows and my terrible stock from yesterday(IRBT) went down another 3% today. But i'm still holding it I think it's a major overreaction they still dominate their market and I'm holding them

 

[AsUpRoDiGy]

yeah I've completely changed my investment plans over the years I used to try and time the market, get in and out etc. People here several times pointed that out to me.

Sounds funny but I finally talked to someone at work who told me the same thing and showed me stats on getting in and out and how you almost always miss the big up days doing that. I paid for a one year Motley Fool Stock Advisor, bought a bunch of stocks they recommended that have for the most part done well(until the last 2 weeks) and it has completely changed my philosophy. They very much preach the buy and hold long term plan and that's the way I'm going now.

Every now and then I'll sell a stock I don't like anymore but nothing like what I used to do.

Today went much better although we closed off the lows and my terrible stock from yesterday(IRBT) went down another 3% today. But i'm still holding it I think it's a major overreaction they still dominate their market and I'm holding them

IRBT fell off a cliff, but that definitely seems more like emotional sentiment over people seeing red than anything else. Earnings look good, and RSI indicates it's way oversold. Charts don't look great on it, as they dipped below the 50 and 200 DMA, but that's from people freaking out it looks like. If their 2018 Q1 reports indicate they're headed towards the billion revenue mark...it'll rebound back up into the 80's. If you have the opportunity you can wait for it to bottom out and lower your avg position...might be worthwhile if you plan on holding it for a bit.

 

[Russ Smith]

IRBT fell off a cliff, but that definitely seems more like emotional sentiment over people seeing red than anything else. Earnings look good, and RSI indicates it's way oversold. Charts don't look great on it, as they dipped below the 50 and 200 DMA, but that's from people freaking out it looks like. If their 2018 Q1 reports indicate they're headed towards the billion revenue mark...it'll rebound back up into the 80's. If you have the opportunity you can wait for it to bottom out and lower your avg position...might be worthwhile if you plan on holding it for a bit.

I nearly sold it 2-3 weeks ago. The reason was funnily enough our nephew was looking at robotic vacuums at home on Amazon and started naming interesting ones and he said "the Roombas cost too much." I started to wonder how many people make that same decision. But i convinced myself not to sell, I was down about 5% on the stock then, over 30 down now obviously. I could average down on it but I've also got a fair amount of the stock already, and I'm not entirely sure it's at the bottom, they had good earnings, and even the guidance was pretty good. If you follow the company they always guide very conservatively.

The last hit was when some short analyst wrote a thesis that Shark and some other lower priced models were going to take tons of market share. Stock tanked. Then reality set in , 2 of those companies settled suits with IRBT agreeing to stop selling because they were infringing patents, a couple of others have some performance issues, and the stock went back up. I am for now feeling the same thing will happen. Plus the company is branching out it's in pool cleaners, gutter cleaning and some other stuff and they're doing digital mapping because they use wifi that I suspect might make them an interesting takeover candidate in the future when someone decides how to utilize all that information on wifi in your house, where the dead spots are etc.

Way down right now but I think longer term they're still the industry leader.