≈ Santa Claus is not coming to town. ≈
Bad news + Market is up = Strong market › The Bulls are in control.
Good news + Market is down = Weak market › The Bears are in control.
Only a few things in life are certain, like death, taxes and the affirmation above.
Market participants don’t look into the past to find solid reasons to sell or to buy. They look for neither strength nor weakness in the lines written in the Book of Life.
However, they don’t look into the future either. By nature, the future is… well, the future is opaque, it’s never landed, it is no matter, it’s not in the elemental chart.
So how do market participants make their decisions?
Let’s say they work on the edge of tomorrow. They see things that are about to happen, things that must happen or are already happening and no one is seeing yet.
Financial markets are a complex system: millions of participants (including robots), multiple variables and uncertainty plaguing on each and every corner.
“I got my bag, run right home
Then I find I’ve got the number wrong.”
— One after 909 (The Beatles) —
There’s nothing wrong in being wrong, as long as you diversify, buy insurance against your own convictions, and acknowledge the fact that you can be wrong.
These simple rules kill overconfidence and keep you in the game whatever the market goes.
Chart of the Day
A WORLD GROWING APART
Coach Mark wrote yesterday about the world not growing in unison. Here’s how much apart countries are growing (or shrinking). (Source: IMF & Signal)
Video of the Day
Exiting Adjusting or Hedging a Bear Call Spread gone bad
Coach T answers a question on how to handle a Bear Call Spread that is moving against you.
Today’s Lineup
TALES OF A TECHNICIAN
The Nightmare Before Christmas
If you’re wondering if we’re in a “bear market,” we are. If you’re wondering when it will end, nobody knows. If you’re wondering where Santa Claus is, stop it. He’s been eaten by bloodthirsty and unholy bears. And that means his rally likely isn’t coming. Unless, of course, Jerome Powell spontaneously sprouts a beard ala The Santa Clause and releases a flock of doves tomorrow.
Traders Lounge 11am EST
Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.
The Coaches Show 8:30PM EST
This is our weekly MasterMind group. Join the coaches tonight, 8:30pm EST to discuss the markets and help you prepare for the week.
Halftime Report 12:30pm EST
The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day and fun in a way that only Matt and Tim can deliver.
Market Recap 4:30pm EST
The Market Recap is designed to give you a quick overview of the day that was. While brief, this report is designed to cover all of the major events that drove the markets that day and help you plan for the trading day ahead.
