October Game Plan!
Yesterday was the last day of Q3 and just a week away from the kickoff of the up and coming earnings season. It’s easy to parse out a number of dynamics presently playing out. Despite September historically thought of as the weakest month of the year, October is the most volatile – a month of implosions on the one hand, but on the other, one also known for its ability to kill bear markets!
The historical tendency towards weakness in September didn’t play out this year but hopes are high among traders that volatility will finally pick up in October. Unfortunately for the bears, a rise in volatility as far as 2017 goes would seem to favor an uptick in the market rather than it losing ground.
The most important thing for us to internalize from the month of September is that it’s important to stay open-minded, rather than rigid and unbending. For the dogmatic bears it was particularly difficult seeing that they continue to believe that warning signs from the past are still valid in our current market environment.
There’s no doubt that the dynamics in the market have changed significantly over the last few years and that what’s driving the market now is entirely different than the forces doing so in the past. Bad news a plenty reared its head in September, though the market ignored each and every new curveball: the Fed tightening its stance, hurricanes which sowed utter disaster, scandals galore from the West Wing and a tax plan unanimously perceived as deemed to failure from the moment it was announced in its current iteration.
The big lesson the market recently inculcated in us is that it’s a mistake to be unwilling to budge in your take on the market! You need to be ready to adapt and change when the conditions change and in most situations, these conditions are caused by price movement and not by the news!
I, like everyone else on the market, have no idea what’s going to happen in October. The bears will continue to expect the market to peak before taking a turn for the worse – and they’ll give us seemingly endless reasons why that’s what’s going to happen. The bulls will demonstratively ignore their every claim, while staying focused on the positive price movement. It would be inane to forecast what’s going to happen when push comes to shove. The best tack now is to keep an open mind. Be vigilant and understand what’s causing price movement and react the moment conditions change. If you do that effectively, you’ll succeed in routing the market!
Friday’s Hot Stocks: TSN, LB, ATEN
|Tuesday||9:00||S&P Case-Shiller||0.4 %||Medium|
|Tuesday||10:00||New Home Sales||583 K|
|Tuesday||11:50||Janet Yellen Speaks||“Prospects for Growth: Reassessing the Fundamentals”||Medium|
|Wednesday||8:30||Durable Goods Orders||1.5 %||Low|
|Wednesday||10:00||Pending Home Sales Index||-0.1 %||Medium|
|Thursday||8:30||Jobless Claims||270 K||Medium|
|Friday||8:30||Personal Income and Outlays||0.3 %||Medium|
|THO||Thor Industries, Inc.||PM||Monday|
|DRI||Darden Restaurants, Inc.||AM||Tuesday|
|MU||Micron Technology, Inc.||PM||Tuesday|
|WOR||Worthington Industries, Inc.||AM||Wednesday|
|CAG||Conagra Brands, Inc.||AM||Thursday|
|MKC||McCormick & Company, Incorporated||AM||Thursday|
|CMC||Commercial Metals Company||AM||Thursday|
Today’s Picks – Day Trading!
New York Strategy Swing