Trump Stock Market: Bull vs. Impeachment
Updated Aug 2023
Once again, we are providing information within a historical context for two important reasons. First, it allows you to gain a genuine understanding of our actions during this tumultuous period. Second, it underscores the valuable lesson that history can teach us, particularly in the realm of investing. One of the key takeaways is that stock market crashes and episodes of panic should be viewed as opportunities to be seized rather than feared.
In light of this recent update, there isn’t much to add except that the amount of money sitting on the sidelines continues to grow. Politicians persist in displaying baffling behaviour, and individuals wear their emotions openly, sometimes even to an alarming extent. Even well-educated individuals seem to have descended to a level akin to apes, if not lower. Maintaining a certain distance from the spectacle is vital to avoid getting entangled in the commotion.
Investor Panic: Is This the End of the Trump Stock Market Trend?
According to experts at Lipper, investors have recently exhibited panic behaviour by withdrawing over $40 billion from equity funds in just the past few weeks. This massive drawdown is reminiscent of a similar occurrence in 2016, and history shows that such mass decisions often don’t bode well. When we combine this data with the trends we’ve been observing over the past three weeks, it becomes apparent that if the market experiences a pullback, it should be seen as an opportunity to buy. In the event of a substantial correction, the wise approach may be to “back the truck up,” metaphorically indicating a considerable buying opportunity.
Politics and Its Impact on the Markets
We’ve fielded numerous questions about our political preferences and affiliations. Let’s clarify from the outset that we diligently avoid letting personal views influence or bias our outlook. Such a course of action would be a recipe for disaster. The individuals on the political stage often appear to be driven by drug-induced dreams of a brighter future, yet they frequently lack concrete plans to translate these dreams into reality.
It’s a common observation that most politicians are more focused on appearing good rather than actively pursuing genuinely beneficial actions for the nation. This tendency has led to a decline in their approval ratings, painting them in an unfavourable light. If we were ever to endorse a political figure, it would be someone akin to Ron Paul—someone who champions libertarian principles, seeks to manage national debt, reduces foreign interference, advocates for hard money policies, and, above all, endeavours to enhance the country rather than serving the interests of corporate entities. However, it’s important to acknowledge that the odds are stacked against such an individual, making it a somewhat wishful notion for someone of this calibre to assume a position of power.
Consequently, we often find ourselves confronted with choices that fall into the realm of unfavourable or exceedingly unfavourable. This predicament leads to the adage that it’s preferable to deal with the known devil rather than being forced to acquaint oneself with an unfamiliar one. From an observer’s perspective, adhering to the principles of trend analysis and mass psychology, it appears that the markets tend to favour a Trump victory. It’s crucial to emphasize that this is not an endorsement; rather, it’s an observation grounded in mass psychology and trend analysis.
The Future of the Trump-Era Stock Market Bull Run Without Trump
The question arises: What happens to the Trump Stock Market Bull Run if Trump does not secure a victory? To us, in the grander scheme of things, it means absolutely nothing. We wouldn’t lose a night’s sleep over it. Life continues, with or without any particular individual in office; we always have a Plan B.
However, it’s important to note that if Trump were to lose, there is the potential for civil unrest. We won’t delve into this topic in detail, but you’re likely aware of the divisions in the country, with regions firmly divided into red and blue, both in terms of size and population density. When intense clashes occur between individuals with solid viewpoints, tensions escalate, and animosity between these groups continues to grow.
Adapting to Changing Trends: A Perspective
We maintained silence on China until the prevailing trend shifted in their favour. Our approach is pragmatic – we don’t engage in empty rhetoric when the trend aligns with a particular direction. This same mindset guided our stance on the precious metals sector. Despite our inclination towards hard money principles, we acknowledge the impracticality of expecting those in power to endorse such ideas. This realization led us to diverge from Gold in 2011, much to the chagrin of Gold Bug and Hard Money enthusiasts. They mistakenly assumed that our bullish stance from 2003 to 2011 implied we were Gold bugs.
In truth, we are not aligned with any specific ideology; we are trend players. If the trend were to turn bullish on unconventional sectors, even peanut vending, we would readily embrace it. From a financial perspective, we forecasted that a Trump victory would have a bullish impact on the markets, a sentiment we expressed as far back as 2015.
Will Trump Win?
That is another story, but the hidden support we are tracking remains unchanged, and that hidden support could be as much as 20%. As we stated, his most significant drawback is his big mouth. If he were to cut back his rhetoric by 50%, his likability would probably rise above that mark. However, it seems an impossible feat; he seems to take a perverse delight in slugging it out. Therefore, even though the show looks wild now, we can quite comfortably state that we are only at the appetiser level. The stench from this all-out catfight will get so bad that a skunk, in comparison, will smell like a rose.
Regardless of whether he wins or not, the Trump Stock Market Bull is not because of Trump but because the trend is bullish. When the trend turns negative, this bull market will end regardless of whether Trump is in power or not.,
Maximizing the Trump-Era Stock Market with Options
Options can indeed yield substantial gains, but they come with the potential for significant losses. It’s crucial not to over-allocate your funds and to be aware that you’re taking on higher levels of risk. This is where the saying “no pain, no gain” truly applies. There are two effective ways to mitigate this risk:
1. **Use Only Profits:** Consider using only the profits you’ve already earned from investments to venture into options trading. This way, you’re not risking your initial capital but the gains you’ve generated.
2. **Trim Unnecessary Expenses:** Another approach is to cut back on unnecessary expenses and redirect the saved money toward options trading. This could involve making practical choices, such as creating your vacation package instead of opting for a package tour, purchasing a high-quality used car instead of a brand new one, or reducing dining out frequency. By reallocating this “dead money” into options, you give it a new opportunity to yield substantial returns potentially.
Taking Profits
Regarding taking profits, we put a list of suggested profit targets for subscribers to choose from in the passcoded section. One suggestion is to choose a profit target for stocks and options for half your holdings and stick to it. For example, 30% on stocks and 100% on options. Remember, no one ever lost money on banking profits. We have a strategy in place that is based on risk-to-reward ratios and the pattern of the stock, but one system cannot cover everyone’s needs, and that is why we put up the info on taking profits in the passcoded portion of our website.
A quick look at the Dow
The weekly chart of the Dow Diamonds indicates that the MACDs have now experienced a bearish crossover. Does this mean you need to panic? Not there are many instances where the markets do nothing, but if this market pulls back strongly, then there should be no hesitation over your next move; panic should never enter into the investment equation.
A Tactical Investor refuses to panic even when there is no reprieve in sight, for history indicates that panicking never pays off in the markets. The masses were and will always be prime cannon fodder candidates; they are hard-wired to panic, and when they do, the outcome is never good. Examine any panic-based event, and one thing stands out like a sore thumb: the masses always took a beating.
The Bearish MACD crossover is taking place in the minimum overbought ranges, and long term, this means that the Dow will trade in the extreme to insanely overbought ranges for an extended period.
Insights on Trump and the Market Landscape
Many in the media and a significant portion of the populace wrongly attribute the current state of affairs solely to President Trump’s tenure. It’s crucial to understand that Trump is a product of the prevailing trend; he doesn’t shape the trend. If he had opposed the trend, his election wouldn’t have materialized. Likewise, if he had pursued the presidency in 2008 or 2012, he likely would have faced defeat because the prevailing trend was different at those times.
Presently, the nation is deeply divided into two distinct camps, and levels of polarization, already high, are projected to soar even higher. This environment presents a golden opportunity to sway the masses, as their heightened emotions often blind them to other significant events occurring right before their eyes.
Expect legislative changes aimed at making it as easy for individuals to borrow money as it was during the era of “liar loans.” This will provide added momentum to the stock market because when people feel optimistic, they tend to embrace risk. The financial crisis of 2008 can be traced back to the banking industry’s leniency in extending loans to individuals who previously wouldn’t have qualified for home purchases. Eventually, this influx of capital will flow into the stock markets, likely triggering one final explosive surge before the markets face a substantial correction.
Trump Stock Market Update March 2020
The root cause behind the exaggerated response of the markets to the Coronavirus outbreak can be attributed to one simple factor: sensationalized news. Fear, rather than logic, is currently driving the crowd, leading to a pronounced market reaction. However, it’s essential to recognize that this reaction is poised to be even more robust when the prevailing fear eventually subsides.
In the history of every bull market, there exists at least one formidable correction that is often mistaken for a market crash. The ongoing correction has the potential to transform into such a backbreaking correction, defined as a minimum 20% decline from its peak. The encouraging aspect is that every backbreaking correction paves the way for a more formidable upward surge.
Given the intensity of the current market sell-off, it’s highly likely that we will witness a rally. Typically, the initial attempt may falter, and if historical patterns hold true, this failed rally could precede another downward wave, potentially pushing the market to new intraday lows. If this pattern demonstrates strength, it might be prudent to consider either a short-term put play or the opening of a strangle position, which involves calls and puts with different strike prices.
Lastly, a valuable piece of advice: maintain a trading journal. The optimal time to document your observations is when market turmoil is at its peak.
Originally published on November 22, 201, this content has undergone periodic updates over the years, with the most recent revision completed in August 2023.
