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

Monday | November 2, 2020

Hello Eizell.





YESTERDAY: October 30

SPX 3269.96 -40.15

The market opened lower by 5 SPX points, but that was not realistic. After disappointing earnings by AAPL, AMZN and FB, the market had to anticipate a drop in the FAANG stocks, which would take our major indexes lower.

We quickly fell after the open. After reaching a low of support near the famous 3230 line, we gyrated in a rather wide channel all day. The E-minis follow these three stocks progress in lock-step, with its primary focus on AAPL.

The SPX was down -76 points at its lows, making us enhanced for the year. We started the year at 3230.76. This is where buyers came in and took us higher to close at 3268.96 in the SPX.


TODAY – Hostage Situation – Today and tomorrow are the last days.


(Please do not take offense to what I write here. I am not being partisan or trying to upset people. I am trying to make a prediction on an election, and how it will affect the market. I upset people in 2016, but was right. I upset people with Brexit, but was right. And I am sure I am inadvertently upsetting people today. NOT MY PLAN. I am just giving my reasons for why I say what I think will happen without supporting or endorsing any candidate.

Our job as traders is to judge the winner of a beauty contest. We can't pick who we think is the prettiest. We have to guess who the judges will think is the prettiest. I never agreed with the choice of Ms. Universe, but it didn't make her any less the winner).

Yogi Berra was the working man's philosopher and once said: “It is like deja vu all over again”. Election 2020 is almost exactly like election 2016, and people wonder why I feel so confident in my prediction Trump will win.

The Chicago Bears before Mike Ditka was the worse team ever, and deservingly so. They practiced Einstein's theory of insanity by doing the same thing over-and-over again expecting a different result. Walter Payton left, Walter Payton right, Walter Payton up the middle, punt. The fact that he always had all 11 men chasing him on every play and only missed 1 game is amazing.

Because I obviously am a masochist, I remained a Bears fan growing up. It also helped that I met Walter Payton several times when Soldier Field was being remolded and they used Northwestern's Dyke Stadium which was a block away from my grade school. Trust me, I got more out of climbing the playground fence (including a signed football that I gave my brother) than I would have from sleeping in another math class. The majority of people in this country can't do long division either.


TRUMP WILL WIN and the market will run higher.

If I am wrong and Biden wins, we will fall at least 10% fast. It will stop down -20% if we are lucky.

I have not changed or wavered in my opinion since I first made the prediction. The fact that we are living in Cobbler's Cove, Pennsylvania in a deju vu of GROUND HOGS DAY makes it even more steadfast. I grew up blocks away from Bill Murry and went to the same high school, but I hated this one movie of his. It doesn't make the movie less real.

The good news is that a recent survey found that 68% of Americans “feel EXTREME stress” from the elections. The good news is that in 2 days, some of this stress will end after the usual 1 week of crying and riots. Lock yourself down for a week like it is corona 3.0, and stay out of Chicago, Portland, Detroit, Baltimore, etc.

My favorite part will be watching 20 celebrities going to the airport to move to Canada again, only to return in an hour.

I know, I know...I am a jerk. I have been hearing that for 6 years when I said “China is our real enemy, not Russia”. Russia has a smaller GDP than Brazil, and is not much bigger than Indonesia. Russia is not putting fiberglass in our medication like China.


Traders need to recognize patterns, even if they don't like it. The two most obvious patterns I have ever seen are: I am bad at marriage and Hillary/Biden are interchangeable. 340 million Americans and they were pushed to the front of the line, not because they were the strongest candidate, but because it was “their turn”.

Biden 0 and 3

This is Biden's 3rd run for president. Amazingly, I maintain that despite being a horrible presidential candidate, Biden could have won had he picked Oprah or Michelle Obama (instead of Kamala, who her own party didn't nominate) as a running mate. No objective individual realistically expects Biden to make it his first term (not even Biden who admits he is a “transition” President) before an Article 25, so the VP pick was much more important than his current choice.

I would have loved to see an Oprah/Biden ticket , or would it be Biden/Oprah ticket. I would have believed the polls saying they were up 14 points.


How did Biden expect to win?

Biden is actually running on a platform of higher taxes, taking away guns (goodbye Texas = 38 votes and Wisconsin = 40 points), getting rid of oil and coal (good bye Pennsylvania = 40 points, West Virginia = 15 points, Oklahoma = 21 points, and Texas again = 38), and BidenCare (replacing ObamaCare) and maybe packing the supreme court .

Trump could not get California's 55 electoral votes no matter what he did. Yet, the last debate where Biden said he would get rid of oil, coal and fracking may have cost him 114 points. His campaign manager had to hear that at the end of the 2nd debate and then cried. You add the fun issue from Wisconsin and it totals 144 points. That is more than half of the 270 Trump needs to win.

Another thing... most people in this country are not doing well financially to start with. The lock down is making it worse. The thought of higher taxes (instead of a Trump stimulus check) has to be on some people's minds.

Even if that is his goal, I can't believe a guy wanting to win the Presidency would admit to this. He is running to please the 10% of extreme left, not the majority. Not the smartest move for someone wanting to win.

Obama at least had the brains to lie to us, and tell us the price of insurance would go down, and we could keep our doctor. Some may take exception to my saying Obama lied. Obama is a very smart man. It did not come as a surprise to him what would happen under ObamaCare. That is just a opinion/fact, not a dislike for Biden.

The GREAT NEWS is I only have two more days where I have to talk about this “hot topic” . I hate politics and not aligned with either party. I want the best person to win, not a a donkey or elephant (and no...that was not a Biden and Hillary crack).

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 -36% for the year (this has been here since January 1).

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 intermittent volatility
(+1.21% so far)

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