We did it!
For a minute anyway – that's how long the S&P 500 held its new record high (2,873.23) for before falling steeply back down to the 2,850 mark and, this morning, we're bouncing back to around 2,860 as more Members of Team Trump are convicted of crimes that the President knew nothing about and didn't discuss and doesn't believe and WITCH HUNT!!!
I think, usually, in a "witch hunt" the prosecutors don't find so many actual witches, do they? Webster's actually defines "Witch Hunt" as: "The searching out and deliberate harassment of those (such as political opponents) with unpopular views." That's not quite the same thing as the actual uncovering of a culture of graft and corruption as well as uncovering evidence of collusion indicating possibly treasonous actions against the United States of America carried out by a political candidate and his family in an effort (successful) to steal the Presidency.
This is serious stuff folks! No one "did the nose" here – these are real crimes that have been committed and, as Michael Cohen testified yesterday "at the direction of Donald Trump." Yes, Cohen was the assassin but Trump is the mafia don who ordered the hit – and those guys go to prison too! And it's not just Manafort and Cohen. Michael Flynn, Rick Gates and George Papadopoulos have all pled guilty and are currently cooperating with prosecutors. The case is, of course, still building (you have to be beyond 100% certain if you are going to charge the President of the United States with Fraud or Treason) but here's what we know so far:
The President claims these 71 connections between himself, his people, Putin and Putin's people are all just fabrications by the Liberal Media and they must have photoshopped all the pictures and fabricated all the evidence and, of course, made up their own facts. The funny thing is, it's working. Trump's relentless campaign against The Truth has caused "facts" to be confused with opinions and, like many dicators who destroy the free press or make them the enemy, it allows his followers to ignore all the evidence against their beloved leader – no matter how damning.
As investors, however, we need to take these things more seriously as at least some of the President's crimes may indeed catch up with him and lead to proceedings that may destabilize our Government and send our markets crashing back to Earth. We did have a bit of a sell-off as Manafort and Cohen were found guilty yesterday but, as usual, the Futures staged a rally though, with the VIX popping to 15 and staying there – I'd say it's a very fake rally and we'll be shorting the S&P (/ES) Futures below that 2,860 line -just like we did yesterday– along with the same 25,800 on the Dow (/YM), 7,400 on the Nasdaq (/NQ) and now 1,715 on the Russell (/RTY) – same rules as yesterday too to keep us out of trouble!
Remember the rules – wait for at least two indexes to cross under, then short the laggards unless any of them pop back over – in which case take a quick loss. Like yesterday, it's a very positive risk/reward ratio that we like – especially when we're testing new highs for no reason on low volume!