Option Trading Newsletter :August 12,2015

Wednesday

August 12, 2015

1-855-RWT-0008

Prepared by the good people at Random Walk, LLC. (and Scott)

Call the office for assistance!

Today’s Number(s)

Yesterday and Today

Yesterday

CHINA ATTACKS U.S. (and Europe)

This is essentially what happened. Modern warfare doesn’t happen with tanks, missiles and planes anymore because the whole world figured out that they can’t beat the US by conventional means. Even acts of terrorism sting us hard, but make us stronger. You see, we were once an economic super power and that is why we could afford to be a military super power. And that is why the USSR collapsed – trying to be a super power militarily but not economically.

So now everyone beats us down on our weakness – the slush fund of the world and forcing the U.S. To be uncompetitive.

China in a not surprising move, but surprise in timing, devalued their currency, making their products for sale more competitive. This has medium to long term negative affects in the U.S., but the short term effect was catching the U.S. And European markets by surprise.

TAKE
The interpretation the annalists and media spun on this was “China must be even weaker than previously thought”. And so the market fell 200 points on the open. It hit a low of -264 with the E-minis down 28 or -29.

Bonds surged on the news, a flight to safety.

China Related Stocks

Anything that had influence in China such as BABA or AAPL got smashed.

Essentially, anything that was up yesterday was down today – and the reverse.

TODAY

I doubt the volatility is over with regarding China. We might get one more day of fear hitting U.S. Investors before people discount things as “just another country weighing down the U.S., but it will pass”. Then people will start to think about the subsequent and inevitable bounce, and buying will kick in.

A lot depends on how things go at 9:30pm eastern (writing this at 8:30pm) when we find out more about how much China is devaluing, and how their stock market is looking to open. My guess….selling followed by buying after we hit a low for the day.

BUT KEEP IN MIND…Tuesday’s market caught me by total surprise. I was looking forward to another positive day in the markets after Monday’s big run higher, but China caught me (and the rest of the world) by surprise. So all bets are off, no predictions are based on a solid “feel” for the markets. I am as confused as anyone else here. Futures at 8:30pm are up 5 points indicating a positive open, but I would NOT go off of that until we know more about China in an hour.

OPTION TRADERS

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POT is held each Wednesday night at 7:00pm eastern.

Contract the office at 1- 855 – RWT – 0008 for more details.

Too True To Be Funny

For a guy and his girlfriend with two kids all you have to do is follow these proven steps:

1. Don’t marry her!

2. Always use your mom’s address to get your mail.

3. The guy buys a house.

4. The guy rents out house to his girlfriend with his 2 kids.

5. Section 8 will pay $900 a month for a 3 bedroom home.

6. Girlfriend signs up for Obamacare so guy doesn’t have to pay for family insurance.

7. Girlfriend gets to go to college for free being a single mother

8. Girlfriend gets $600 a month for food stamps.

9. Girlfriend gets a free cell phone.

10. Girlfriend get free utilities.

11. Guy moves into home, but continues to use moms address for his mail.

12. Girlfriend claims one kid and guy claims the other kid on their tax forms. Now both get to claim head of household at $1800 credit.

13. Girlfriend gets $1,800 a month disability for being “crazy” or having a “bad back” and never has to work again.

This plan is perfectly legal   and is being executed now by millions of people.

A married couple with a stay at home mom yields $0 dollars.

An unmarried couple with stay at home mom nets $21,600 disability + $10,800 free housing + $6,000 free Obamacare + $6,000 free food + $4,800 free utilities + $6,000 Pell grant money to spend + $12,000 a year in college tuition free from Pell grant + $8,800 tax benefit for being a single mother = $75,000 a year in benefits!

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Attorney Stuff

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