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

Thursday | February 6, 2020

Hello Mayumi.



YESTERDAY: February 5

1,100 Dow Jones point in 4 days, and 124 SPX points in the same period. Yesterday, the market made new highs in the NASDAQ and SPX, though barely. This going into the Senate vote on impeachment of President Trump on 2 articles.

Last Friday, the Dow closed down 603 points with the world panicking that the Coronavirus was getting out of control. Three trading days later, the market didn't seem to care about the virus, and was more focused (and surprised) that TSLA was down over $100 points instead of higher by $100 (again).

Last Monday, the market bounced 34 SPX points higher and analysts and the media were telling everyone to not believe the bounce. They were warning that the virus was going to drag down global GDPs by 1/2%, and things can still get worse. The markets ignored it and didn't care. And once again, we are back to the scene of the crime where the markets originally fell from.


Trump was acquitted, but this was Part I. We will see many more attempts, with a whistle-blower ready to testify that President Trump does not put down the toilet seat in the White House when done.

TSLA fell back to earth closing down -17.2% (-$152.35) at $734.70.


TODAY: February 6

Short Term = Higher

When the Coronavirus first started, I admittedly was a little concerned about the markets. I specifically said that it is not going to be a big deal at all, and would be a huge buying opportunity after a quick drop.

When the Zika and Ebola viruses hit, the markets fell as much as 7% before bouncing, so I was hoping/expecting a drop of at least 5%. At the lows, the market fell only 3%, which took the markets down 0.16% for the year. That is almost nothing.

The fact that we can't sell off more than 3% (from high to low) in a market that started out overbought indicates to me that this market is strong. TSLA and AAPL have been perfect examples of money rushing in and chasing the next possible leader.

We are going much higher, but it will not end well by summer.

Average year with lots of intermittent volatility
(+3.22% so far)

POT Logo

Last night, we had a PRACTICAL CLASS on the short butterfly that is going to be implemented today. This class was asked for and created via an accumulation of questions coming about the SHORT BUTTERFLY being done in practical terms. I have had a couple students in a short butterfly, and then nervous when the market moved to the center strike prior to expiration. This caused large emotional stress to where a class such as this was needed.

Today, I will enter into a FAST example where I am looking to scalp market direction, and if I am wrong, I will turn it into a short butterfly. After this, we will talk about wider butterfly spreads and condors. FUN STUFF



Up and Running for POT students (so far).

Really quickly...

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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.

Trump acquitted.



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