Are You Prepared If Markets Crash More Next Week?!
In a Nutshell
Markets are experiencing sharp volatility from AI stock sell-offs, negative free cash flow in Big Tech earnings, and geopolitical risks like tanker attacks driving up oil prices. The core advice is to prepare for potential further declines around midterm elections and upcoming Fed rate decisions by using small position sizes, avoiding margin, and buying dips only with money you can afford to hold through volatility. Long-term holders should view corrections as buying opportunities in quality names like Meta, Google, Microsoft, and Amazon while maintaining disciplined risk management.
These notes were generated by AI and may contain inaccuracies.
Today wasn't that bad. Nasdaq market has lost 3.47% compared to the low we reached at 483. A 1% recovery from the lowest level at the end of the day isn't too bad.
No one can predict, but everyone can prepare. When the market is trading at near all-time highs, they create pressure, they trade irrationally. Even companies invested in for the long term would never be bought at that price, because eventually these kinds of corrections always happen.
The AI revolution is not over. The NASDAQ 100 is still up 11% year-to-date and about 70% above its April 2025 low, which was in the aftermath of Trump's tariff war. Looking back to when the pandemic began in 2020, positions that felt like being punched in the stomach were actually just a minor deviation.
This is the beauty of long-term investing. When a good opportunity comes along, take advantage of it. It is also important to acknowledge current concerns. The Nasdaq market ended the week at one of its lowest levels in the last 3 months due to this AI technology sell-off. More than $2 trillion has been wiped out of the US market today alone.
One of the main reasons markets have started to behave in a really uncertain way is income season. Alphabet, Google's parent company, and Amazon released their earnings reports and they failed to meet their targets. They have reported fairly good earnings, but their free cash flow is negative and they are investing aggressively in AI by 2026 and plan to double or even more aggressively in 2027. Apple and Palantir are coming on Monday. AMD is coming on Tuesday. Uber is coming on Wednesday.
Two things can be true at the same time. Some stocks have taken quite a big hit. Intel and Dell fall was actually kind of happy to see because they were never trusted, as the Trump administration was inflating and manipulating them all. Fundamentally, their trading and valuation had no match for their performance. Trump was just promoting it.
Meta, Google, Microsoft, Amazon are loved. Whenever their share price drops, more shares are added to long-term positions. Each child also has a long-term account where a little bit was added too.
Prepare yourself as if there is still a chance that you will make a mistake. Think about what could happen next week. November 3rd is midterm elections. Trump is not attacking Iran like before. He was given some kind of instruction not to do that, hoping to win the midterm elections.
What happens if the Republicans lose the midterm elections? If anyone creates a major contingency, it's Trump. How crazy will he react? What will he do next? Will he care that the market is already under pressure? Or will he say it doesn't matter? At that moment, will an investigation be launched against him? Will the market go further down? If he attacks Iran in a way never seen before.
Four tankers were attacked today alone. Oil tankers... oil prices are going up. Oil is the biggest contributor to rising inflation rate. Due to high inflation, the Federal Reserve is expected to raise interest rates at the next FOMC meeting in early December. This is not positive for the market, but rather negative.
Prepare to endure instability with your own money. Don't take on extra debt, don't use margin. For example, if you have $10,000 that you want to invest, invest in $1,000 or $2,000 increments. Meta's credit rating was downgraded after the market closed. Fear is at work in the market.
Hang this reminder on the wall: there may be volatility in the short term. Are you in a position to tolerate it? The team has never been so prepared before. Made a little over $7,000 shorting INTC today. Also did very well with Sandisk yesterday, earned another $7,000. Two very good days in a row.
Don't like shorting when the market is already oversold. Trying to buy during the dips, but very purposefully. Don't want to overwork or get overconfident too soon, then the price will fall even more tomorrow. Would rather attend a rally late.
If the market really starts to turn around and Trump isn't overreacting, and Apple does better than expected, and fears and concerns slowly reduce, and the Nasdaq, the QQQ goes back above 700 and goes back to 730, 740, 750, that would be great. These are step-by-step ways to move forward. Don't put yourself in a position you can't tolerate.
Trade live every morning as soon as the market opens. Can rewatch one of recent live sessions for 30 minutes to an hour when the markets open. Access to the LPP lesson library and private group chat. The current sale is running at $2.25 off. With the ongoing sale, it costs less than a dollar a day, specifically $0.30 per day. This is a one-time payment. Members who signed up in 2018 paid once, never paid again, got access to all the updates, and still watch trading live every day.
Do it purposefully and more calculatedly. Watch your position size, create a plan, don't use margin, don't use leverage, and prepare yourself to endure volatility.
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