Wednesday, April 24, 2019 12:37:47 PM
The Best Bet For Stocks Is That No U.S./China Trade Deal Is Announced
As you all know, stocks have been rallying since December 26, 2018. The first quarter rally has been nothing short of amazing. Almost every trader and investor is waiting for a U.S./ China trade deal. Every few days we hear that a trade deal between the two countries is getting closer to actually happening.
Volume trends have been extremely light in 2019 which indicates very little selling pressure in the markets. Contrary to popular belief, light volume actually favors upside in the markets. Hence the old market adage, never short a dull market. At this time, many traders and investors are waiting for a trade deal to be struck by the United States and China. Simply put, nobody wants to get caught short when a deal is announced. After all, all we hear in the financial media is that a trade deal could add another 10 percent of upside to the market immediately. So who in their right mind would want to be short right now.
It is probably better that there is no actual trade deal announced in order for stocks to continue climbing. What would happen if the talks between the U.S. And China fell apart right now? That would probably be a big hiccup for the major stock indexes. On the flip side, should a deal be struck and signed then there will likely be another pop in the markets in the near term, but after an initial spike it could be a sell the news event. After all, the markets are rising on anticipation of a deal being announced very soon.
Nicholas Santiago
InTheMoneyStocks
As you all know, stocks have been rallying since December 26, 2018. The first quarter rally has been nothing short of amazing. Almost every trader and investor is waiting for a U.S./ China trade deal. Every few days we hear that a trade deal between the two countries is getting closer to actually happening.
Volume trends have been extremely light in 2019 which indicates very little selling pressure in the markets. Contrary to popular belief, light volume actually favors upside in the markets. Hence the old market adage, never short a dull market. At this time, many traders and investors are waiting for a trade deal to be struck by the United States and China. Simply put, nobody wants to get caught short when a deal is announced. After all, all we hear in the financial media is that a trade deal could add another 10 percent of upside to the market immediately. So who in their right mind would want to be short right now.
It is probably better that there is no actual trade deal announced in order for stocks to continue climbing. What would happen if the talks between the U.S. And China fell apart right now? That would probably be a big hiccup for the major stock indexes. On the flip side, should a deal be struck and signed then there will likely be another pop in the markets in the near term, but after an initial spike it could be a sell the news event. After all, the markets are rising on anticipation of a deal being announced very soon.
Nicholas Santiago
InTheMoneyStocks
Join the InvestorsHub Community
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
