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

Monday | June 1, 2020

Hello Eizell.

YESTERDAY'S CLOSING PRICES

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YESTERDAY: May 29

Thursday, we saw the SPX hit a high of 3068 before falling and closing in negative territory right at the close. This set up a bearish tone after having seen the Dow rise 1,000 points in 2 days. Friday morning, the markets opened up falling for several reasons. We have people rioting in 30 cities, claiming it is protesting. We also were told that President Trump was going to have a press conference at the end of the day detailing how he was going to punish China for many violations. Lastly, we were getting horrendous economic numbers.

The day opening lower on Friday seemed like a no-brainer based on the close Thursday, and the expected nervousness the market would have with riots and Trump speaking. I even stated this in the MORNING COFFEE REPORT as seen below:

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On the open, the market fell to SPX 3005, and then spend most of the day in the 3005 to 3015 range, leading up to President Trump's announcement. Once President Trump spoke, the market fell to SPX 3,000 where it sat a couple minutes and then launched dramatically higher.

On the close, the SPX settled at 3044.11; however, minis kept climbing after futures closed.

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TODAY: June 1

TODAY – SLIGHTLY LOWER – Maybe 3,000 again (but doubtful)
MEDIUM TERM – Consolidation around 3,000
LONG TERM – NEW ALL TIME HIGHS (possibly), and then a NASTY trade war sell-off

On the close Friday, we had a 10-15 point short cover higher, and it didn't seem real. Of late, these things have been happening often, and usually it is reversed the next day. This means I would expect to see a move lower by 10-15 points on the open with all variables being equal.

Protests

I don't give the protests much credence as far as moving the stock market.

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.

2020 ONE-YEAR PREDICTION:

Average year with lots of intermittent volatility
(-5.77% so far)

POT Logo

Starting today, we are going back to trade type designations. You will recall, we suspended the designations when the markets went nuts. Starting today, we will go back to LITE, FAST, etc. type of trades. People loved the LiTE trades. These were examples that were slow moving and slow adjusting. Not much work needed. We had to stop it when the markets were moving more in an hour than it usually moves in a month. Things are calm enough to start LONG-INTERMEDIATE TERM EXAMPLES.

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DISCUSSION BOARD

Up and Running for POT students (so far).

Really quickly...

To help in your quest for the best possible options trading outcomes, we would like to know what level of options trading knowledge and skills you currently have. Please click the button below to indicate what level of trader you are? Please skip if you already responded. Thank you for participating.

P.O.T. Schedule to come.

LAUGH OF THE DAY

Trading is a tough job on a stomach void of coffee and humor.
You provide the coffee and we will take care of the rest.

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Disclaimer

For education purposes ONLY. Please read the disclaimer below. We do not care if you agree or disagree with it—that is the rule. ​​​Stratagem Trading (Stratagem: “StratagemTrade.com,” “Stratagem”), and any of its possible affiliates, respective independent contractors, employees, officers, or agents are not acting as licensed financial advisers, registered broker-dealers,tax advisers, etc. (although some individuals may or may not hold a license). Furthermore, they do not provide financial advice, make recommendations, or conduct business by transacting trades. Stratagem Trading adamantly states that nothing in this communication constitutes a solicitation, promotion, endorsement, offer or recommendation to buy or sell any investment, mutual fund, debt instrument, commodity, derivative product or security as described herein.

Stratagem does NOT offer auto-trades. Case studies being provided are historical examples illustrating how a particular commodity, equity, index and/or option strategy could have been implemented. Stratagem Trading is not providing students with real time trading opportunities, nor giving advice. We strongly recommend that you consult with a licensed financial professional for all your financial matters.

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