Is Evaporating Clinton Lead Weighing on Stocks?

In many circles, it is conventional wisdom that a Clinton victory is good for Wall Street. After all, the Wall Street elite are among the biggest donors to her campaign. So, as the polls have tightened over the last ten days, and especially since the Comey letter to Congress about new evidence in the Clinton email probe, stocks have been sliding. In fact, the S&P 500 has closed lower in 8 out of the last 9 sessions, including today. Does this mean that investors may be anticipating the possibility of a Trump victory more and more? A victory that they fear? Perhaps. Keep in mind, we just got a muddy 3rd quarter GDP report last week that gave more amunition to the Fed to hike rates, and we've had a mixed bag of data ever since. On top of that, we just passed the peak of earnings season. When all is said and done, the stock market has gone NOWHERE for two years now. Today's close is only about 5% higher than it closed exactly two years ago. The market is also richly valued by most measures and top line revenue growth in corporate America remains weak. With all this in mind, I wouldn't read too much into how the election is impacting the market. We are due for a significant bear market anyway, no matter who becomes president.

A blueprint for making big money in stocks

Most people follow the typical Wall Street advice of investing in blue chip stocks that pay dividends, thinking that there is no way to beat the S&P 500 returns over the long run. I'm here to tell you that not only is it possible to beat the S&P 500, but you can absolutely crush it. Here is your blue print for making big money in the stock market. First of all, this plan should only be utilized with risk capital, until you become experienced enough to handle the risks involved in trading stocks. I define risk capital as the amount of money you can afford to lose without having a negative impact on your lifestyle. Ok, so here is the blueprint... 1. Only trade stocks that are making new all time highs or 52 week highs in price. Remember, we are talking about trading, not investing. Our intention is not to buy a stock with the intent of holding it for years. We are only looking to capture chunks of a major trend, and particularly the high momentum portion of the trend.

2. Forget about the penny stocks. Yes, you can make a big chunk of change in a few hours by day trading some of these stocks. But, our strategy is for the long run. We don't want to be stuck in front of our computer trading stocks every day do we? We want to have the money to do whatever we want, whenever we want. 3. We are only interested in stocks that have at least some institutional sponsorship. This shows up in the stocks volume. Ignore stocks that are only trading a few thousand shares every day. You need to focus only on stocks that will catch the interest of a few big investors. 4. Don't focus much attention on the underlying fundamentals of the company. Leave that to the Wall Street analysts who need to justify their salaries. The law of supply and demand is the only fundamental we care about when it comes to trading stocks. If demand is high, and the supply of shares can't meet that demand, then the stock price will go up. Let other people worry about why a stock is moving up in price. 5. Trade these stocks with a trend following system. A trend following system is simply a strategy that buys strength and sells weakness. Just develop a trend following system that works for you, and that is all you will need. Be sure that system employs a stop loss. 6. Remember this quote..."pigs get fat, hogs get slaughtered." What that means when it comes to trading stocks is that you don't want to risk too much of your capital on any given position, even if you think you know the stock is going to go up in price. The market doesn't care what you think. Use good risk management so that when you lose on a few trades, you'll still have enough capital to exploit the good opportunities when they arrive. 7. Pay attention to the longer term trends in the overall stock market. In a bull market, most stocks will go up in price. In a bear market, even the best stocks can get dinged pretty hard. Learn when to be aggressive, cautious or out of the market altogether. 8. Pay attention to the stock market leadership and be wary of leadership changes. When you notice a group of stocks moving up, buy the strongest in the group. During bull markets, the leaders will go way up in price, but the leadership will also change from time to time as well. For instance, earlier last year, biotech stocks were on a roll...then they crashed. Earlier this year, gold and silver stocks took the lead, then they crashed. 9. DON'T use your trading profits to pay your bills. To build substantial wealth with this blueprint, you must let the power of compounding grow your money. And that is a good solid blueprint for making big money in stocks. Keep in mind, this takes work. You've got to put in the work, study the market, and be patient. You will have losing trades, and some small winners. But, if you can nail a couple big trends in any given year, you will generate big returns. I recently found a website that seems to hit on all of these key points. Check out Stock Trading Headquarters. And that's all I got for today!