I’ll be away from the office for the next 12 days, enjoying summer’s end with friends at the (South) Jersey Shore. The show will go on at Rick’s Picks nonetheless, albeit in a lower gear. The Morning Line essays will cease temporarily, as will daily emails to readers and investors. But timely commentaries and trading recommendations via Facebook and You Tube will still be on offer whenever warranted. I use the phrase ‘whenever warranted’ with trepidation, since it sometimes seems as though Mr. Market enjoys doing really crazy things whenever I am away from my desk for more than a few days. This could be partially attributable to seasonality, with winter rallies and summer dives tracking the phases of the moon. But consider yourself warned that the dog days of summer are over, and that the stock market’s animal spirits are undoubtedly ready to re-emerge, perhaps even before Labor Day.
Updates for the Week Ahead
I have updated my guidance for gold and the E-Mini S&Ps due to Friday’s headline selloff on Wall Street. I hope you took seriously my warning about crazy things happening whenever I’m away from the office for more than a few days. If you don’t subscribe but wish to view the latest updates and others that I will be publishing between now and Sep 4 when I return to my desk, consider taking a two-week free trial subscription by entering your name and email address above.
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Is an invasion of Hong Kong really coming? If its inevitable then there is a trade in shorting the Hang Seng (HSI). It could drop almost 20% before it hits its target and I imagine it will happen fast. With Chinese troops on the streets the exchange will almost certainly be closed for a day or more. Then look out below when it reopens. I am just guessing but this looks like its shaping up to be an ugly week. As an aside, congratulations to all you guys and gals who bet heavily on gold. You were right. My bearish charts and the trade that went with them have being totally destroyed by the trade war rhetoric and Trump’s Tweets. The President has an obvious and uncanny ability to move charts and his timing at key reversals is impeccable. It’s so good I am wondering if he doesn’t actually have the power to cause the dollar to fail at a critical reversal and start dropping. We should all be grateful if he can pull it off because there was not a bigger disaster on the horizon than USD soaring out of control and smashing economies both sides of the Atlantic and Pacific. So I’ll eat my gold and miner losses with humility and try to remember for next time….don’t bet against Trump!
Sometimes Atlas will Shrug.
Have a great weekend Rick.