Todd Horwitz Chief Strategist BubbaTrading.com
Be Prepared not Surprised.
For the past couple of weeks, the bears looked like they were going to take control of the markets. Once again, they failed, and the bulls are clearly in charge. There are many questions that must be answered, will the markets reach new highs? Can the cheap money and stimulus continue to drive markets higher? When will the bubble pop?
There are many reasons to believe this market will fall apart however the market is never wrong. For now, the markets want to go higher, nothing else matters. The FED continues to create new money to satisfy old debt which is the same as a Ponzi scheme. Remember, markets are driven by money and the money is buying.
On the option side call buyers continue to lead the markets followed by more bullish strategies, naked put selling, bull put spreads and call calendars. The VIX is falling creating more bullish sentiment and complacency. We know that at some point the rally will end but the street is full of those who thought they could predict what will happen next.
The top bullish symbols are a mixed bag from all indices including QQQ, TSLA, SQ, IWM and FB. The bears are led by SPY, COST, PTON, MSFT and USO. The mix on both sides of the markets indicate this rally is broad and could be headed to new highs.
As traders and investors, we have one thing to remember, follow the trend of the market. Be patient disciplined and leave your emotions out. The most important thing to remember is money management and self-control.
Todd “Bubba” Horwitz
BubbaTrading.com