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October 1, 2018 | Unexciting News Drives Short-Covering Frenzy

Rick Ackerman

Rick Ackerman is the editor of Rick’s Picks, an online service geared to traders of stocks, options, index futures and commodities. His detailed trading strategies have appeared since the early 1990s in Black Box Forecasts, a newsletter he founded that originally was geared to professional option traders. Barron’s once labeled him an “intrepid trader” in a headline that alluded to his key role in solving a notorious pill-tampering case. He received a $200,000 reward when a conviction resulted, and the story was retold on TV’s FBI: The Untold Story. His professional background includes 12 years as a market maker in the pits of the Pacific Coast Exchange, three as an investigator with renowned San Francisco private eye Hal Lipset, seven as a reporter and newspaper editor, three as a columnist for the Sunday San Francisco Examiner, and two decades as a contributor to publications ranging from Barron’s to The Antiquarian Bookman to Fleet Street Letter and Utne Reader.

I’d expected the looming decision concerning Kavanaugh’s Supreme Court appointment to weigh on stocks in the days ahead, but Wall Street evidently couldn’t care less. The Dow was up nearly 200 points, taking its inspiration from headlines concerning Tesla (Musk has been ousted as CEO by regulators but will continue to run the company);  GE (a new CEO, Larry Culp, has been chosen); and NAFTA (as expected, Canada has joined the agreement). None of these events could be described as world-shaking, but that doesn’t mean DaBoyz cannot use them opportunistically, as they so often do with unexciting news, to goad bears into a short-covering panic such as we saw on Monday. I expect the rally to continue for perhaps another day or two, given the bullish look of some key charts, including ones for AMZN and the E-Mini S&Ps. I still regard the bull market as overextended and filled with dangerous bravado, considering that America will undergo a wrenching change both politically and economically if Trump loses his majority support on Capitol Hill on November 6. He is in fact likely to be impeached if that happens, reversing the nation’s fortunes in ways that investors could no longer ignore.

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October 1st, 2018

Posted In: Rick's Picks

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