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Un-Trade Alert: Earnings didn’t save it, so what’s next for the stock market now?

Cody Willard

Cody Willard

— 2 min read

I’m back from a one day, 10 hour whirlwind trip to LA which included one breakfast meeting with a movie Hollywood agent (who’s also a Trading With Cody subscriber), one lunch meeting with a real estate/early cryptocurrency investor, and one big office meeting about aggregation, distribution and monetization of content in the ever-ongoing App Revolution. Six hours of driving back and forth to the ABQ airport for that and then this morning, I had two hours of driving back and forth to a highly-recommended ophthalmologist for a much needed eye check up.

Well, the good news for the bulls is that we’re no longer hearing anybody talk about how earnings are going to save the stock market. The very same talking heads were so sure about that going into earnings season because “earnings growth of 20% plus” is so strong are now talking about how that earnings growth was apparently indeed “already priced in.”

Well, they could have been reading Trading With Cody as I kept explaining that:

Six reasons why I’ve shifted to selling rallies instead of buying dips

March 7, 2018 by

Earnings might not save stocks near-term either

April 6, 2018 by

Here comes earnings season. Oh, and Bitcoin rallies!

April 12, 2018 by

So what about now? I’m not so sure that just because this quarterly earnings season is getting closer to its end that its beginning — and that therefore the sell-the-news reaction is completely over — that the markets are going to just bounce right back to their recent highs. I’m not sure buying puts is a great idea any more, though I rest easier knowing I still have some put hedges on the sheets. I’m not sure I’m in any rush to pile into more stocks, though I’m going to be nibbling a few of our existing longs in the next few days, so stay tuned for that. In the meantime, let’s ask ourselves and the public some questions, if only to see what the results might indicate in a contrarian kind of way if there’s an extreme majority on one or both of my questions:

What do you think would shock the most people right now? (Take the poll on my Twitter feed here.)

  • A 5-10% rally in the stock market.
  • A 5-10% sell-off in the stock market.
  • A tightly rangebound stock market.

And of course the go-to question: Who’s more scared right now? (Take the poll on my Twitter feed here.)

  • The bulls.
  • The bears.
  • Everybody’s scared.
  • Ain’t nobody scared, everybody’s greedy right now.

Look, as I so often remind you guys, there’s usually much more value in sitting than in trading. Recall and/or read for the first time my many Un-Trade Alerts. We don’t have to try to game every up and down in the stock market. It’s foolish to try to catch tops and bottoms. We’ve had so much success over the years, as all my many long-time subscribers will tell you many new subscribers of late, by finding the most Revolutionary Investment opportunities early and/or when they’ve been trashed and are cheap and then holding most of those core positions for years or decades. Letting the market come to us. Taking a long view and trying to maximize our potential upside while minimizing our risks for the next 10,000 days of our lives. Not the next ten days.

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