Market ‘Insanity’ Is Trader’s Opportunity

2020-08-26

Another crazy day in the stock market set the tone for the week, and may indicate market conditions into next year.

Simpler’s traders have dubbed this environment “market insanity at its finest.” Huge swings in the indexes from day-to-day keep everyone guessing.

Debate will continue through multiple printings of future history books as to why this market is so volatile. Suffice it to say there are many factors with market influences shifting on a recurring basis.

Part of what’s fueling volatility in this market is the influx of new traders. Since the beginning of this year, millions of people have entered the market with hopes of trading classic patterns for quick money.

The inexperience of these traders often runs head-on into how the market can show big promise and then empty a trading account. Kodak to go long anyone?

Simpler’s traders see this volatility continuing into next year before any real “normalizing” of the market.

That may sound bleak to the inexperienced trader, but those with experience see this as a traders market with high potential.

Volatility in a bull market creates opportunity. Traders who can adjust their plans, act on their knowledge and training, and take advantage of recurring setups tend to fare well in this environment.

Experienced traders are aware of news, the Fed, and historical trends, yet they don’t get caught up in the crowd trying to run with what’s praised and popular. Kodak anyone?

All this market “insanity” can be a boon for traders — new or experienced — who want to learn more and work the market for profits.

Don’t expect the craziness to end soon and all of a sudden have a quiet stock market — no matter which way the election goes.

This market is barreling ahead with a bullish trend, so we won’t fight it. We’ll keep trading as this stubborn bull runs its course.

We Saw: another crazy day across the market — 

  • Another record day for the S&P 500
  • Another record day for the Nasdaq
  • Dow jumps back into positive column

We’re Watching: Fed speech to start the day tomorrow —

  • Quick adjustments as the market shifts
  • Lead up to TSLA 5-1 stock split
  • Setups in: TSLA, FB, AMZN, MSFT, ROKU

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