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

Monday | May 11, 2020

Hello Eizell.




I wrote on Friday that we would FINALLY go through 2900 – AND STAY ABOVE IT. This can be seen below, and requires a much larger run higher than the night Minis were suggesting.


For several weeks, 2900 was a magnet. We closed above it on April 29th and 30th, but then quickly fell, prompting people to think they had been tricked into buying the top (again). The media immediately came out with their panic and 20/20 hindsight that the coronavirus recovery was going to be a “U” or “L”, not a “V” bottom. They mentioned that the market is seeing the S&P trade on a 20 P/E, and a dozen other reasons to be scared.

Well, that was just a temporary flushing of the “weak long” toilet. On Friday, AAPL closed at 310.13 (+6.39), along with most of the FAANG/FAAMG stocks helping drive the market higher by 455 Dow points. The NASDAQ is higher on the year despite crazy unemployment numbers.


April payrolls fell by another 20.5 Million and unemployment reached 14.7%. I had MANY people reaching out to me (even my ex-wife) asking “how bad are we going to crash today?” My answer was – We will fall UP 500 Dow points. Mystified why we would go up I stated, “you only think we are going lower because you listen to media sound bytes.

The market went deeper than the number and sound byte. Eighty percent (80%) of the jobs lost were temporary and expected to come back when we reopen the country. That is MUCH better than ANAL-ysts anticipated. In short – the numbers are horrible, but not anywhere near as bad as people expected.


TODAY: May 11

I suspect we will not exceed 2955, and may test 2900 to the downside. It is hard to guess in these times, but that 55 point range should hold today.

On Friday, the charges against General Flynn were dropped by the DOJ, suggesting that they were a sham to start with – and they were. One of the next drops in the market will come from geopolitical issues with China, but also with internal government strife. If you do not think this scam to impeach a duly elected president (like him or not) was not a coup, then you have not been thinking impartially, nor reading the news. People... remember, books are just TV for smart people. This is going to be bigger than Watergate, but the opposite of what the media is selling.

It (hearings and jail time), for many high ranking officials, will likely be minor compared to the things coming down from China and the coronavirus again. We will try to punish China. We will move our supply chain from China (covertly). China will flex its last bullet – intimidation. Perhaps they will see how far they can go to taking over Taiwan? We will push back. Things will escalate, and the markets will get nervous.

I am still standing by my prediction (made December 31, 2019) that we will be positive for the year and making new all-time highs by the end of the year. I maintained this stance even when the SPX was down -35% for the year.

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
(-9.32% so far)

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