Don’t Fear the Stock Market Zombies

It’s a new week and the news just gets crazier…

Markets went berserk Friday after we learned Trump tested positive for coronavirus. Investors are glued to their TVs as the political gossip clogs the airwaves.

So I figured we should begin the week with something a little more upbeat.

Check out my latest “Top That Trade” video I recorded with my friend Phil Flynn from Fox Business News. Click the video to get my take on zombie companies, my October Halloween trade pick, and the scary dangers of short selling…

Keep it In the Money,

Alan Knuckman

Alan Knuckman
Editor, In-The-Money

Chart of the Day: COVID comes for the White House

Greg Guenthner
By now, it’s old news.

But the revelation that the President of the United States contracted coronavirus late last week sent markets into a tailspin. Investors frantically reassessed how they were positioned Friday morning, fighting to get out of “re-open” trades and back into the more Covid-sensitive plays.

Coincidentally, we were just talking about the resurgence of the “work-from-home” stocks Friday morning. Did the market know something was up in Washington? I doubt it. This is simply a trend that is accelerating as new virus fears circulate.

We showed you the renewed strength in the Direxion Work From Home ETF (NYSE:WFH). This bullish move continued early Friday despite the market’s big gap lower. If Covid fears continue to dominate the election news cycle, we could see these stocks once again lead the market higher.

Just look at Peloton Interactive Inc. (NASDAQ:PTON):

PTON

It wasn’t too long ago that this stock was considered a joke. But look who’s laughing now. Shares have jumped more than 480% off the March lows. Sure, it’s overextended after cruising above $100 last week. But if you’re looking for leading names to add to your watch list, this is a no-brainer trade idea.

Trading Tip of the Day

Most traders fail and give up before they ever make a profit.

Some new traders throw in the towel after churning their accounts for months. Others tap out after the sting of a big loss. Inevitably, a few gunslingers wipe out their hard-earned profits on a big bet gone wrong.

I don’t have any hard data that explain why so many folks fail to make it in the trading game. After all, there is no exit interview with your broker when you blow up your account.

But if I had to guess, I would say most traders don’t make it for one simple reason:

They try to outsmart the stock market.

Many market newcomers view trading as a battle of wits. They’ve determined that they need firepower to beat the market into submission. That means mastering complicated software and learning how to use countless indicators to pinpoint trade ideas.

Yet over the years, I’ve found that the more complex you make your trading strategy, the worse your results will be in the long run. When it comes to trading, simple is best.

Of course, simple doesn’t always mean easy. It’s not easy to implement a simple trading strategy. But with the right mindset and guidance, you can begin your own journey down the path to profitability.

— Greg Guenthner

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Alan Knuckman

Alan hails from the home of options trading in Chicago, where he began working as a clerk on the floor of the Chicago Board of Trade (CBOT). Beginning with his days on the floor, Alan’s worked with all aspects of the options markets for the past 25+ years.

Transitioning from a clerk to a floor...

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