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

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.

Rick Ackerman October 1st, 2018

Posted In: Rick's Picks

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