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Prepared by and Scott
Writing under the nom de plume of J.L. LORD

Tuesday | April 14, 2020

Hello Eizell.




The day opened with the SPX down -7.36, but with a steady stream of selling until we reached a low of SPX 2,721.17 (-68.65). Get this will apparently didn't dawn on traders or the media until yesterday that the start of earnings this week might have some companies reporting horrendous numbers. AND THEY WILL.

We had a very strong market the last two weeks, and a pullback was healthy, but the media is blaming it on earnings concerns. I am quite sure people knew earnings were coming up, and are concerned about them.

By the close, 2/3 of the losses were made back as the MINIS closed down -20.25. Despite the large selling of 328.60 Dow points, AAPL was higher by $52.6, AMD was up $2.56, and AMZN was up 126. People are buying the winning stocks from before the virus.


This is a chance for every CEO who has been massaging numbers for the last 3 years to show good growth to pull all the dirty laundry from under the bed. Bad numbers are not their fault, after all, it is the virus and the President for shutting down the country. They are as much a victim as if they had contracted the virus.

As a matter of fact, some CEO's may even take a draconian approach to reporting earnings in an attempt to look like super heroes after this passes. By putting a huge negative spin on earnings, they can have a lower high-water mark to reach when the country reopens.


Many international companies will need the help as they WILL move their manufacturing process out of China to other cheap labor countries, or back to the US. I am betting Cambodia, Vietnam and the Philippines gets the lions share of jobs. Can we trust China again? Shame on us if we do.


TODAY: April 14

I stated a month ago that 20% is a normal bear market and 7.5% is the average the market fell during the H1N1 and Ebola outbreaks. So on March 23rd and 30th when we hit the lows, I stated “I think the selling is over and we have nothing to fear. I pointed out we have a healthy economy, and the threat to capitalism is not near like in 2008. For a month, I put up on the Morning Coffee Report that the worst is over and to not fear.

I put up Alanis Morritestte and Christopher Robin quotes about not being afraid. Today I took them down. Why?

Yesterday, we opened lower because of earnings fear, and yet the MINIS only closed down 28.19 with the Dow down 328. That is NOTHING. You may forget that last month, we had days of down 2,000 Dow points.

Not only is the worst behind us, but I am going to be the first to say we will be setting new records by the election. It will not be without some big scares, but we are going to recover as a nation, and run like hell – PROVIDED the Fed doesn't step on our “stuff” and raise rates too soon when we come out of this.

S&P 500 Price Limits

From 8:30 a.m. to 2:25 p.m. CST, there are successive price limits corresponding to 7%, 13%, and 20% declines below the previous trading day’s reference price.

From 2:25 p.m. until the 3:00 p.m. CST close of the cash equity market, only the 20% price limit will be applicable.


Average year with lots of inter42mittent volatility
(-14.56% so far)

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