Confirmation of a Directional Change

Confirmation of a Directional Change

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Good morning folks, and welcome to the Rude Awakening!

The headline today is: we are currently facing a downward trend in markets across the globe.

Let’s discuss further…

A Directional Change to the Downside

We are now into three weeks of a downturn.

If you look at markets across the world, you’ll see that not only is the US market falling, but every major market in every country for today.

We are seeing red across the board.

The market is digesting a lot of information from last week and this week.

Fed Chairman Powell’s announcement…

Supreme court judge nominations, after the death of Justice Ruth Bader Ginsberg…

China today is coming out with their own blacklist of companies to counter President Trump’s…

Trade war issues bubbling up again…

Coronavirus worries everpresent…

Developments with the US dollar’s strength… (we haven’t had a dollar this strong in a long time)

Like I said, a LOT going on, and it’s making for a lot of fear from investors.

What Was Bolstering Our Market Now Sinking Us

As you know, a strong dollar hurts US companies, making goods and services less competitive with the international marketplace.

If you look at a heat map of the US stock market, you can see the biggest market movers, the “monster” cap stocks that were pulling the overall market up — AMZN, GOOGL, MSFT, FB, AAPL — are pulling us down now.

We are now definitively below that 50day MA.

So we have to wonder, where will it stop?

Well, that we can’t know, but we can trade it!

We just have to trade to the downside, and for the short term…

Trading an Index

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But for now, I’ll leave you with this: Like I keep telling you, play the markets as they come. This is a trader’s (NOT an investor’s) market! Although this selloff is a massive swing, it doesn’t have to hurt your ability to profit.

That’s it for today.

But remember, if you have any questions, comments, or ideas you want to share, we’re here to help! Just email askscott@paradigm.press. We can’t give you personalized investment advice, but I want to help make the Rude Awakening the best it can be for you, and your feedback and questions are crucial in that.

Talk tomorrow!

Regards,

Scott Stewart

Scott Stewart
Editor, Rude Awakening

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Scott Stewart

Scott Stewart has been trading for decades. He has acted as an analyst and educator on the stock market for just as long. As your Rich Dad's Weekly Cash Flow analyst, Scott works tirelessly to ensure you know everything you need to do when entering into new positions, and adjusting trades as you go along....

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