DON'T GET TRAPPED: HOW TO TRADE THIS MARKET CRASH
In a Nutshell
Markets are reacting to AI development pauses, Trump's tweets, and an 89.5% chance of a Fed rate hike on September 16th, with the 10-year yield back at 5% pushing mortgage rates to 7-8%. Traders made solid gains on Dell and other positions but closed all shorts before overnight, while stocks like Crowdstrike trade at extreme valuations with 5,300 P/E ratios. The key advice is to work with market moves rather than fight them, as Trump will likely intervene to prevent major selloffs ahead of the rate decision.
These notes were generated by AI and may contain inaccuracies.
Markets reacted strongly during the pre-market session due to AI news. Three of the biggest CEOs and founders of AI companies have all agreed to slow down in the development. People are speculating it's because they need to clean up their act before their IPO.
Trump was on a tweet rampage in Trump fashion, unapologetically himself. The speaker calls this market manipulation and states "I think it's market manipulation, right? I've called it out for what it is. I don't care who does it."
Markets get influenced by these tweets regardless of agreement, and it's better to work with the market than against it. The NASDAQ market began to recover and recovered all day until the final hour when markets pulled back, ending 0.88% in the red.
According to the Federal rate monitor tool, there is an 89.5% probability that the Federal Reserve is going to raise interest rates. The rate decision is scheduled for September 16th at 2 p.m. Eastern time.
President Trump claims that Iran wants to make a deal. The speaker notes this pattern occurs when the market is down or bond yields are up. Bond yields represent the interest the US pays on money that it borrows. The speaker states "Trump only claims that Iran wants to make a deal when the market is down or bond yields are up."
The 10-year yield is back at 5%, meaning 7 to 8% mortgages are back on the table. The speaker references the TACO pattern where Trump backs out at the end and makes such claims.
Democrats voted against the Clarity Act due to specific wording. This has been a big focus for the week.
The speaker made $4,700 on the day through the LPP team. Coree sold off 6.75% and the position is fully closed. The speaker does not carry shorts overnight, stating "shorting comes at a greater form of risk. Just because I short doesn't mean that you should."
Dell Technologies generated $12.6K on the day with position fully closed. The speaker trades live every morning with members who signed up in 2018 paying once for lifetime access.
Crowdstrike ran up 13.85% and hit new all-time highs with no new fundamental news. The stock has 44% downside according to investing pro software with a 5,300 P/E ratio. The market cap is $241 billion while the company makes $65 million in net income. The stock trades at $235 per share.
The speaker states "This might be the most expensive stock I have ever seen ever" and "you are paying such a high premium to own this stock at $235 per share."
Trump claimed he was going to top off the oil reserves with Venezuela oil, but US strategic oil reserves remain at the lowest levels since 1982 with no top off occurring. Bank of America shares slipped 5.7% after the CEO stated trading revenue for fiscal third quarter has been flat.
The NASDAQ has been trading sideways besides the leg down, holding above 700 for QQQ with resistance around 730 to 740. If the rate decision comes in higher than expected with an interest rate hike, markets could break below the $700 support.
The speaker states markets are incredibly irrational and that Trump will do everything possible to prevent markets from falling. The advice given is "don't fight it. Our job is just to work with it."
The speaker remains open to markets selling off but notes Trump always intervenes. The rate decision on Wednesday is considered the most important event of the week.
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