Election Trading Plan: What I Didn’t Get to Say on Fox Business Today
The editorial staff here has been excited to start a series of articles digging into the nuts and bolts of the system scans that are in my latest book The 10-Minute Millionaire.
But there’s so much going on with the big mid-term elections that I just had to hold the presses and tell you what the TV producers are bugging me about, and more importantly – some trades you can take after the election results are in the can.
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So here’s what I stopped the presses for: my notes for my appearances on Varney & Company this morning and Making Money with Charles Payne this afternoon. Plus…
My favorite plays for the markets tomorrow morning (after the smoke clears!).
First, the background…
Here’s How the Markets Will React to Mid-Term Elections
- Midterms – big point no one is hitting: Polls have been SO wrong over past two years
- Especially for populist driven votes likes Brexit & Trump presidential run
- But also: Mid-terms in 2014 (where polls missed the big defeat Dems suffered in the Senate)
- Scotland, Israel, and Greece
- The big question – Could they get it mildly or wildly wrong – again?
- Expected: Dems get House, GOP the Senate
- Market drops modestly overnight
- If Dems swing more than expected – deeper drop
- If Dems win fewer House seats than expected and GOP add seats in senate, then short drop and recovery Wed/Thur
- This will be an opportunity to pick up beaten down big techs and others
- If Dems take both House & Senate
- Huge drop – 3 to 5% overnight or more
- Have to turn intermediate term defensive
- If GOP takes both
- Big pop overnight
- Buy everything that’s not bolted down
- Market melt-up into year end
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And with those scenarios laid out, here are the moves that I didn’t get to share with two national TV audiences today:
My favorite FAANGS to buy after a “one chamber won by each” dip:
- AAPL (biggest 2-day drop in almost 6 years – nice pullback to grab)
- AMZN – will continue to rule e-commerce
- BABA – start accumulating position anticipating resolution to tariff troubles
- ATVI (Activision/Blizzard) – longer term eSports play on a pullback
If we need to get defensive:
- PG – High Quality consumer staples – everyone needs Tide and Pampers, no matter what happens
- DWDP (Dow DuPont) – my old company – still exploring break-up value and throwing off cash
I’ll be back later in the week with some further insight once the dust settles. I’ll also be releasing part one of the series which delves into the market scans in my book, The 10-Minute Millionaire. If you don’t have a copy, click here to become an “Insider” and get yours today!
Great trading and God bless you,