Monday
Aug 24, 2015
1-855-RWT-0008
Prepared by the good people at Random Walk, LLC. (and Scott)
Great Morning!
Closing Prices From Yesterday
Confused? Don’t know if you are protected in a crash?
Call the office for assistance!
Today’s Number(s)
Yesterday and Today
Yesterday
1,000 Points Were Cut Last Week
The Dow, which was nailed to 18, 000 for 6 months, derailed. The SPX, which was nailed to 2,100 for 6 months, became unglued.
Friday the market fell 531 Dow points and 57 SPX points while the NASDAQ fell 171 points.
All of this really started on Wednesday.
Most of the media will blame it on China. NO!
Most of the media will blame it on falling oil. NO!
Two reasons for this fall:
ONE ā It was ripe to happen, though I didn’t expect it this soon. Historically this should not happen until a blow off top (which never occurred). Perhaps China’s blow off top was all that was needed.
TWO ā It will not be mentioned or said for years. Perhaps I am wrong and it will never be mentioned. I think Wednesday’s Fed minutes pulled down the curtain of the might Oz and we saw an old man/lady quite inadequate of magical powers.
Read the Fed minutes last Wednesday and tell me if I am wrong. First they say that based on their numbers (three months to discern) they have not met MOST of the requirements for a Fed hike. Then they said they almost raised rates. Which is it?
For me, if I were a fund manager listening to this carefully, this would indicate the Fed is clueless. They have NO IDEA what they want to do or how to unwind their lousy $4 trillion in debt, meanwhile the market lost $1 trillion last week alone. Another $1 trillion came out of international funds. Even Warren Buffet lose (personally) $3.4 billion last week, and Zuckerberg (Facebook) lost $1.7B.
As it stands we are NOW in correction territory- something people have been nervous about for 1,500 days.
Broken down by sectors we see:
TODAY
China at Night
At 9:10 eastern (40:00 minutes after China opened) the Shanghai index is at 3212.32, down 295.42 points ā or 8.42%. This is HUGE considering China just approved their retirement funds to invest up to 30% of their money in the stock market, and no one is biting.
Keep in mind that China could still fall another 10-15% because they suck. There is not more of an MBA term to phrase this other than the word āSuckā. They are a giant pyramid club that people are investing in companies like race horses ā they like the name. They have no idea why this company or that is any good, much like eToys in 1998 in the U.S.
The biggest holdings are the biggest hit names. AAPL for example took a 6.125 hit on Friday alone. FB (Facebook) too a 4.97% hit. NFLX lost 7.58%. What does this mean? Real selling by the public which is a healthy sign. They are always the people panicking at the bottom and buying at the top.
TODAY
We are NOT done.
We should see a messy open today because of China. Did I mention they suck? Have I mentioned that they are not a real stock market as most of the companies stink?
This has out markets looking down another 2% on the open, which is about 400 Dow points. I expect to see the worst on the open.
Support is at SPX 1918. If we go through that by more than 4 points it will be a mess.
I will send SPECIAL UPDATES AS NEEDED, but keep in mind that this is NOT 2008-2009.
A Separate Update is Coming ā OBVIOUSLY
We were VERY BUSY FRIDAY.
After the open futures bounced to where we were down only -3 to -5 points and we bought a $20 put spread. I then bought (near the close) another $20 put spread and tried to sell a deep ITM put spread at $4, but was NOT filled. So we have that to sell on the open at better prices.
I will give a breakdown and delta in your update,but we are fine.
POT is held each Wednesday night at 7:00pm eastern.
Contract the office at 1- 855 ā RWT ā 0008 for more details.
Too True To Be Funny
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Attorney Stuff
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