At this crisis point in history - what could possibly create these rare and extraordinary gains?

An Arizona multi-millionaire's revolutionary initiative is 
helping average Americans  find quick and lasting stock market success.

Since the Coronavirus came into our lives this slice of the stock market has given ordinary people the chance to multiply their money by 96% in 21 days on JP Morgan.

Economy  | April 24, 2020

I don't recall a time in the last 25 years when there have been more market participants struggling with the logic of the market action. It is very difficult for many folks to reconcile what is the worst economic crisis they have ever experienced with a stock market that has been rallying for five weeks now and appears to want a "V"-shaped recovery.

In every market, there are compelling bearish and bullish arguments, but those arguments are particularly stark right now. The bears focus on the great economic damage we're seeing and the uncertain future, while the bulls focus on the Fed and an inevitable recovery.

Opinions about what will happen are strong, but no matter how compelling the arguments may be, the only real truth is the price action. Whether we make money now or lose it depends on the price action, rather than any bullish or bearish arguments.

Our goal should always be in tune with the price action. That is much harder to do when we don't believe in the logic of the action, but the worst thing you can do is remain stubborn and fight a market that thinks your market thesis is baloney.

Ironically, one of the main consequences of a market that seems illogical to many is that it continues to act the same way. It is similar to the "climbing the wall of worry" dynamic where there is slow and steady capitulation that provided underlying support.

Like many others, I'm struggling with the logic of the market action. I see strong technical and fundamental reasons for why there should be more downside, but the fact that I think those are good arguments is meaningless. The price action is telling me I'm wrong.

This leaves me with no choice but to try to better embrace the price action. It is much harder to do when you think the logic is wrong and that it won't last, but trading is lucrative because it is often quite hard.

I deal with this action by working harder to find individual stocks I can buy. Maybe I keep my time frames shorter and take profits faster, but that is much better than trying to fight the trend.

At some point, the action will turn and I will feel more in tune with it, but in the meantime, I have to address my own cognitive dissonance and find ways to suppress it.

From an emotional and intellectual standpoint, this is one of the most unusual markets that I can ever remember, but we will profit if we seek to understand it rather than battle the apparent lack of logic.

A revolutionary initiative is helping average Americans find quick and lasting stock market success.

275% in one week on XLF - an index fund for the financial sector. Even 583%, in 7 days on XHB… an ETF of homebuilding companies in the S&P 500. 

{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}

You might also like

Stocks | January 28

Stocks | January 28

Investing, Stocks | January 27

Investing | January 27