As I write this just after the market opened the Dow is down by triple digits, the S&P has fallen off, and the Nasdaq is up over a full point. 

The WSJ reported that the price action in the Nasdaq is based on the expected earnings from some of the tech giants.  

On top of that, pharmaceutical stocks got hit on the announcement that Merck pulled out of the Covid vaccine race and AstraZeneca expressed concerns over lagging vaccine distributions in the EU. 

However, is there anyone who thinks that Merck is going to go out of business or that vaccines are not going to be distributed in the EU?

This is just more price fluctuation driven by headlines like we have seen for the last year.  

The Fed is still backstopping the markets, and with the new administration and the Democratic control of the House and Senate, we will likely see more stimulus over and above what they are already working on.

We can have a discussion about whether more stimulus is wise or not, but it is most likely going to happen.  

Here’s the point, my outlook is still bullish.  

Even still, don’t ever put on any naked positions.  I know I sound like a broken record saying that over and over again, however the market turns it can turn FAST. 

And if you have one or more naked positions, it could end up REALLY bad for you. 

I know I keep beating the “no naked positions” drum, but I’ve seen too many people (including me!) get hurt over the years.  

Right now in Options360 we currently have 5 bullish positions.  

Each position has a well defined and limited downside, so we can sleep at night knowing we won’t get wiped out no matter what the market does.

Stock picking, position management, and hedging are the keys to long term success. 

It’s the formula we use in Options360, and it’s the formula I think you should use in your personal trading. 

To Your (Long-Term) Success,

Steve

PS. You can still grab a trial membership to Options360 for just $19.  You get access to hundreds of hours of archived training webinars, 2 live training webinars during your trial month, direct access to me via email, the AMTG world-class customer service team…

And all of my trading alerts.  Just click here and grab your trial membership now.  It’ll be the best money you ever spent.