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Trader Talk: Week of September 30, 2019

Bullseye Brief

Contributor:
Bullseye Brief
Visit: Bullseye Brief

By:

Founder

Wall of Worry

You can understand why speculators have pivoted to being net short for only the fourth time since 2016, according to weekly CFTC data. The barrage of commentary around recession and impeachment is enough to drive anyone to cash, not to mention campaign promises like eliminating private healthcare and ditching fossil fuels.

Fortunately, I think the bark is worse than the bite… and history reveals markets actually rallied each time traders became overly bearish. I am intrigued that Honeywell has upped its dividend by 10%, and the Citi Economic Surprise Index has posted its largest 3-month gain since 1998.

These are not signals of impending doom, nor are income and spending gains which reflect the strongest labor market in 50 years. I admit that my portfolio has been sideways for several months, but a high teens return is still double the long-term norm.

As for the bears, I think they’ll be forced to cover when the US and China come to terms on trade. Mr Trump needs a win right now, and that’s one he can control.

Disclosure: Bullseye Brief

The author holds open positions (as of 9/27/19): ZYNE,APTV,TDOC,NVDA,BAC,MPC,CRM,FB,DXJ,MKSI,INTC,NLTX,APLTMFTAI,LITE,F,QRVO,URI,GS,AMLP,OBSV,

ZION,KRE,NOK,PXD,UNH,BABA,FXI,SBGI,EOG,UBER,WW,VIAB,VRAY,AUPH,WB,AM,AVEO

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This material is from Bullseye Brief and is being posted with permission from Bullseye Brief. The views expressed in this material are solely those of the author and/or Bullseye Brief and IBKR is not endorsing or recommending any investment or trading discussed in the material. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

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