Stock market Predictions with Corona

[MJ DeMarco]

The stock market thrives on a certain level of certainty.

There is no certainty with this, especially something we can't see.

Unlike a hurricane (which people can see/sense), this is more obscure.

But once the conference cancellations start to be publicized, supply chain disruptions, earnings guided lower, and commerce starts to grind down, I expect markets to continue to react negatively.

Additionally, I also believe that this also adds a certain level of uncertainty over the November election. The nice early 2020 run up, IMO, was the market pricing in a Trump re-election, hence, it was forecasting more certainty. That reelection "certainty" also is likely gone, depending how this pans out in the next few months ... partisans are hoping this is Trump's "Katrina", lives be damned. Any administrative mishandling (which is always likely in a situation that might happen only once every fifty years) will be spotlighted, headlined, and beaten to a pulp.

TLDR; I think it will take a few weeks, perhaps months, until the smoke clears and a modicum level of "certainty" is regained. My guess is the bottom will be SPX 2500, which is about a 20-25% correction.

 

[Fox]

It is definitely not helping the owners of Corona beer...
(Shows the impact of negative assosiation)

 

[MJ DeMarco]

Could be quick profit for anyone who wants to be a 0 DTE put.

LOL, I just made 150% on my money in 45 minutes. Definitely a trader's market.

 

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[RadicalShift]

Spending quite a few years on Wall Street, I personally believe the market is in for a VERY rough road for the next 6 months+! After a surprise (no surprise) 50 basis points cut today, and with MORE cuts coming in the next few months, the Fed is trying to do everything in it's POWER to save the market!

 

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[biggeemac]

Drones and robots = the next big thing, since they aren't biological and can be easily decontaminated. You heard it here first.

 

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[socaldude]

My Thoughts About the Coronavirus

Interesting take on the coronavirus by ray dalio.

 

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[BizyDad]

Great case study for SEO guys. Typing corona into Google shows zero signs of the beer for me. The best shot is a newspaper article at the bottom of the first page that talks about the business' losses.

Show'em how much you lose by not being first on Google. Lol.

Thank you for pointing that out. I took a screenshot to share with clients so we can discuss how Google reacts pretty quickly to changes in the meaning of words.

I do see the first organic result is Corona's website. But above it is a lot of Google placed info, first news articles, then tweets, then "helpful info", then "safety tips" about washing hands!

And THEN Corona beer's website...

 

[JohnBuffet]

I'm on the sidelines waiting to buy. I don't think it's at the bottom yet. My prediction is that this downward trend will continue..

 

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[million$$$smile]

LOL, I just made 150% on my money in 45 minutes. Definitely a trader's market.

Yes, I rarely trade as for the most part I regard myself as a total novice, but for the past 10 days I have done incredibly well trading in and out of Biotech stocks.
Again, I am not disciplined enough to have a traders mentality, but fortunately haven't been burned yet.

 

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[RadicalShift]

So what's the sentiment now? Crypto (ETC and BTC) seem to have made a small pump.

I believe we still have a ways to go down. There are just too many factors working against the markets right now. Between uncertainty with virus, an oil war, billionaire Tom Barack saying commercial mortgages are on the brink of collapse, copious amounts of "QE NOT QE" being injected into the market, a SURGING US dollar, and a global economy that is running on one cylinder right now, it's virtually impossible to call a bottom from here.

If you own physical Gold (and/or Silver for that matter), I would continue accumulating. But physical is being snapped up faster than you can imagine right now. Smart people have been loading up for the past 6 months.

So to see a crash in the PAPER metals markets was complete Bull$hit with physical in such high demand. Most metals dealers have low or NO inventory right now.

 

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[MJ DeMarco]

Anyone else who is on the sideline (or wanting to buy more at discount prices) when do you guys plan to get in?

I went long into the close, expect a temporary relief rally next week. I had to sell my SPX positions which were up 2000, 3000% -- when VIX gets up into the 40's and beyond, it's hard to hold onto positions that have those kinds of gains locked in. When something you bought for $85 is now worth $2,500, how do you not? (There's photos of my SPX long positions on the INSIDE in the options thread.)

I trade in 2 accounts, once personal (dividends, paycheck pot stuff) and the other an speculative/options account which I fundamentally try to treat as a business... my personal account (which is usually mostly long dividend and interest bearing assets) took a beating. My trading/options account reached an all-time high -- that's the power of holding long SPX puts as insurance, if volatility blows up while the market tanks, 2000,4000% gains are possible. Those gains were far beyond my loses on the long bets. So now that account sits at an all-time high.

Another thing to note is the market traded after the close nearly 40 points higher (SPX) -- that means the smart money (institutional traders) were getting long (or short coverings) after retail hours -- they specifically waited until the market closed (where retail money trades) to pile in after. It's almost as if the smart money said, "Meh, let these fools sell off during normal hours, we'll buy after the close."

 

[ljean]

Spread betting markets are expecting DJI futures to open -2% tonight.

 

[MJ DeMarco]

I'm gonna read my tea leaves and say the SPY closes at 302.49 today (Mar 2 2020), or around there. It's currently 297.38 about 30m into trading. Just for the record... (and the potential LOLs).

Looks like I was on the money with this until about one hour left of trading... then all hell broke lose.

Had a huge day, going long on Friday paid off. I also went longer in the morning and damn, did that pay off too. Tried to take off risk as the day lingered higher.... still don't think we're out of the woods yet.

 

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[GIlman]

I personally doubt that quantitative easing can solve this problem. There is a huge unknown, will supply chains be disrupted for a significant amount of time and how much impact/people will be affected by the CV.

if people can’t or won’t spend, then QE isn’t going to do anything.

My gut feeling is that there will be ups and downs but we are headed for a prolonged severe down cycle over the next year or two.

 

[MoneyDoc]

How? Why? Sorry, I've seen this discussed in several places, but it makes no sense to me. No one is flying. Flights have been cut down.

Is it on the strength of cheap oil? Counting on a bailout? What's the play here?

Pure blindsight on my part! If I'm right, I make $40-50k. If not, I lose $20k. But it's money I'm willing to lose. Mostly counting on a bailout which I think will happen, but Trump is planning on opening USA "back for business" very soon. We'll see what happens! But again, pure blindsight on my part.

 

[JohnBuffet]

Hey guys,

What are you predictions for the stock market with the current Corona situation going on? I know it's been hit hard for the past few days. You guys think this will continue for weeks? Crash? Go up?

When is it time to buy in?

 

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[Madame Peccato]

It is definitely not helping the owners of Corona beer...

Great case study for SEO guys. Typing corona into Google shows zero signs of the beer for me. The best shot is a newspaper article at the bottom of the first page that talks about the business' losses.

Show'em how much you lose by not being first on Google. Lol.

 

[MJ DeMarco]

TLDR; I think it will take a few weeks, perhaps months, until the smoke clears and a modicum level of "certainty" is regained. My guess is the bottom will be SPX 2500, which is about a 20-25% correction.

Futures down big again this morning, we might have an SPX open in the 2800s.

 

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[James Fake]

My take on overall Markets, Recession, etc. on this thread. I went even boldly enough to declare that I believe we are entering or one foot in the door already into a Recession.

 

[steelandchrome]

I have had a lot sitting on the sidelines waiting to buy and ended up adding long positions in AMGN, SGEN, and VRTX since my assumption is they will rebound faster when the market comes back around than my retail, tech, financial stocks that I already held. I went to trade some puts today but wasn't going to be home all day and didn't want to hold over the weekend so I just bought the long stock and may trade more next week. The account overall has taken a pretty hefty haircut so hopefully a rebound coming as @JScott says even short term and I may take a little off and add back to cash reserves. Disney took my worst hit when they announced the closing of Tokyo theme park for 3+ weeks due to the virus.

 

[Kevin88660]

I think the corona virus impact on the stock market would present a great trading opportunity.

Uncertainty brings high volatility. We could have a whipsaw market that on a longer trend is going up or down or .....Who knows? My point is we are pretty sure that high volatility will stay. This means that simple intraday reversal trades such as buying the dip and taking profit for 1-2 days will generate enormous profit.

Buying dips trades work very well even in 2008 when overall market is down. (In fact buying dips is less lucrative in a calm market) It is counterintuitive but if you google online on the backtested results it works. The analogy is that if you buy a business asset that depreciates overtime but it generates far bigger cashflow daily to offset that depreciation (downtrend).

 

[msufan]

Spread betting markets are expecting DJI futures to open -2% tonight.

Link? Not doubting you, I'd just love to know where to find this.

 

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[ljean]

Link? Not doubting you, I'd just love to know where to find this.

Weekend Wall Street

Weekend Wall Street [EN]

www.ig.com

 

[MJ DeMarco]

I'm gonna read my tea leaves and say the SPY closes at 302.49 today (Mar 2 2020), or around there. It's currently 297.38 about 30m into trading. Just for the record... (and the potential LOLs).

 

[James Fake]

I believe the NYC govt is down-playing the victim and their exposure to the public before she was "contained". Supposedly, she was "isolated upon arrival in New York"... I don't buy that story at all.

I believe they are trying to reduce public panic and fear as NYC would be a really bad spot for this thing to spread especially as their cold season won't let up til at least 2-3 months. She was also in Manhattan which is the most dense part of NYC.

I expect this rumor and news to start breaking here in a few days.. and should affect markets some. This will tie in with Super Tuesday, and I believe much weight is put on which candidate is likely to emerge as a treat to Trump. This will determine how long of a dip and relief bounce and/or recovery run after.

This week should be fun...

 

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[CaptainAmerica]

I'm not understanding why Reckitt Benckiser dropped? Makers of Lysol.....

 

[PizzaOnTheRoof]

Robinhood app had major outage today... This lets me know that this bounce is FULL of WEAK HANDS (the type of investors that use Robinhood the type of investors that accumulate).

There is no strong floor here. I expect further downside here within the next few days. Bitcoin and Gold following the further downside as well.

In addition: as mentioned previously; I believe NYC govt is downplaying their one victim's isolation beforehand. Same movie, different actors. Last time it was Trump and China down-playing, this time NYC govt. Deaths has risen quite quickly if we look at ratio of those infected in the US. China's virus death is topping and should get better from here, the US has just started. I expect at least 50 deaths from this before we see any turn.

Yeah hell of an outage I’ll say lol. The whole day was lost and people lost thousands.

What do y’all think about Co-Diagnostics? (CODX)

They just got approved today to sell test kits in the US. Had a very good day today aswell.

 

[James Fake]

Yeah hell of an outage I’ll say lol. The whole day was lost and people lost thousands.

What do y’all think about Co-Diagnostics? (CODX)

They just got approved today to sell test kits in the US. Had a very good day today aswell.

Imo, any stock related to vaccines or medical supply is a pure Pump & Dump. You could scalp for some good gains, but get in, get out.

There's a lag between demand for medical supply and the growth or reduction of the virus impact. I'd say, if you do buy in, keep in mind do you see the demand for this stuff AFTER May. Anything before that is already priced in and will dump if indeed this virus starts reeling back a bit in warmer weather.

 

[James Fake]

the Fed is trying to do everything in it's POWER to save the market!

I am not that well versed with macro economic stuff, but with my noob eyes this is what the Fed is saying to me (and possibly US stocks):

"Oh shit, our economy is looking like it might hit the shits here soon & we are confirming this"

"We are technically in a recession"

"We are using all our firepower now, so if we aren't in a recession, any future recession, we have less power to do anything"

 

[James Fake]

It's all fun and games until it's in your backyard. Then you realize just how serious it is, and the fear kicking in. Big money based in NYC will FEEL the sentiment and not just try to identify it from the outside.

We are still a week or two out from Max Fear level imo, and this is where I will be coming in extremely aggressively.

Note: Keep a close eye on Friday's close.

Note2: If NYC was smart, they'd shut down Taxi's and schools are a PREVENTATIVE measure. However, most likely scenario, they do it AFTER the spread gains some traction as a REACTION (aka being a step too late).