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

Thursday | March 12, 2020

Hello Friend.

YESTERDAY'S CLOSING PRICES

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YESTERDAY: March 11

Trump's Sell Off

The market opened with the SPX -56.63, which was the high of the day. Minutes later, we were $10-$20 points lower, and kept falling. Why?

We were expecting President Trump to come out the night before at 5:30pm and announce he was suspending the payroll tax, and other initiatives to provide relief to airlines and travel companies suffering from the economic impacts of the coronavirus. What happened? Nothing. There was a speech by the Vice President and his virus team. There was no Trump or tax cuts. That caused the 140 SPX points and the 1464 points in Dow for the day.

I can't listen to “wash your hands and don't touch your face” anymore, but that is all that was said – other than the steady stream of new patients and death updates. So the longer the day went without news about the previously promised tax cuts, the more we sank.

Near the close, we saw President Trump meeting with bankers that can only be described as an attempt to calm and instill serenity to people. It came across (to me) as lacking.

SURPRISES

SPX closed down 4.89%

Dow closed down 5.86%

AAPL closed lower by 19.17 at 285.34 (7.2%)

TLT closed at 156.53 (down 5.98)

VIX closed at 53.90 (higher by 4.55)

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TUESDAY NIGHT

Panic started to set in as Europe's soccer teams announced they were going to continue playing; however, there would be no fans in the audience. After that, the NCAA announced it was doing the same. Later the NBA announced that they too were going to play without fans in the audience. Following that many schools started to say they will be closing and/or holding classes online only.

TRUMP

Despite fear starting to permeate people's psyche, the Minis stayed unchanged leading up to President Trump's 9pm announcement. Perhaps it was optimistic that the President had a “magic pill” or good news to dissuade people's fear and restore the economy?

Tuesday night President Trump was suppose to hold a 8pm Eastern press conference from the oval office, but it started at 9pm. The ONLY thing that was said that was new was we were closing our boarders with Italy. After Friday there are no flights in or out of the US from Italy.

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TODAY: March 12

TODAY

Wednesday March 12, 2020

PAIN. We are now down 20% for the year and 25% from the highs. This is now officially a bear market by definition. After President Trump's speech, the MINIs slid downhill again to -4%. Nothing was offered other than encouragement.

The President obviously has a LOT on his plate and probably not sleeping, be he visibly lacked energy. He probably has 100 people a day in his office with countering advice, and we had Iran slam 12 rockets into our Iraqi base, killing at least one US soldier. This has to be dealt with on top of the virus. Sadly, the President didn't have enough new to day that lifted people's spirits. His attitude from days ago where he came across as in control didn't come across that way last night. I saw it. The liberal media is all over him for it., and the markets saw it.

We will be done hard today until some for of optimism crosses our path. The hard part is knowing when it will come so you don't get trapped.

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.

You’re braver than you believe, stronger than you seem and smarter than you think”.
—Christopher Robin, Winnie the Pooh

2020 ONE-YEAR PREDICTION:
Average year with lots of intermittent volatility
(-15.51% so far)

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Class tonight!

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