Several months ago, I stuck my neck out and predicted the stock market would crash in October of 2019.
Of course, I was careful to hedge my comment saying I could be off by a few days or maybe even a few weeks. But, my message was clear…
At the time of that prediction, the stock market was trading at an all-time high. So, my advice probably seemed a little crazy to a lot of folks. Now though, as we head into the traditionally bearish month of October and considering the action in the market earlier this week, preparing for a crash may not seem so crazy after all.
Market conditions are eerily similar to the conditions that led to previous stock market meltdowns – like what happened on Black Monday (October 19, 1987) and during the financial crisis of 2008. Traders should prepare by raising cash, tightening their stop losses on trades, and maybe even adding some short exposure.
For the record… I’m sticking with my prediction. I expect the market will be quite turbulent in the second half of October. Conditions got oversold enough following Tuesday and Wednesday’s action that we could get a pretty good bounce in the market over the next few days. But, once that bounce runs its course, I’ll be looking for significant downside.
And, that’s a good thing.
Crashes present opportunity for those who are prepared for them. It’s not just the ability to profit on short positions as the stock market falls. It’s also the chance to take advantage of quick trade setups as the technical conditions flip-flop back and forth between extremely oversold and extremely overbought territory.
The stock market’s proverbial rubber band goes nuts in turbulent times. It stretches deeply into oversold territory. Then it snaps back violently, stretching just as far into overbought territory – where it sets up to snap back again.
The trading opportunities are enormous, plentiful, and fast.
The action earlier this week was just a warm-up for what I expect we’ll see later this month. So, if you haven’t prepared for it yet then now is the time to get ready. You could make an entire year’s worth of returns in just a couple of weeks.
Best regards and good trading,
P.S. I see plenty of downside ahead in the stock market. And I’ve been very clear with readers that I see something even more ominous on the horizon…
Investors could lose it all as the market crashes. But traders don’t fear market crashes. In fact, we get excited for them. As scary as they seem, they are a goldmine for trading profits… Especially if you use my strategy.
That’s why I’ve put together a brief presentation for you. And it’s not something you’ll read about in the mainstream media…
Today, one subscriber enjoyed meeting Jeff last week at the Legacy Investment Summit…
Great job by everyone at the Legacy Investment Summit in Carlsbad. I’m glad I was able to meet you to say thanks for all you do. Your insight is very much appreciated, and I hope you already know it’s making a huge positive difference for sure. My goal is to retire from my full-time job by September of 2020 (about a year from now).
The plan is to continue learning to trade and invest so that I can help myself as well as other family members moving forward. The more I learn from guys like you (both trade setups as well as position sizing), the more confidence I have placing the trades, and the less anxiety I have… All is good.
A new subscriber suggests Jeff should write a book…
I recently joined the Delta Report and could not be more pleased with it. I haven’t made a huge amount of money yet, but what I really value is your explanations behind your recommendations. I had some training in options from a different vendor and thought I knew what I was doing. Boy, was I wrong! Lost $40,000 in one year and now I’m working part-time to make some of that up. (I’m 68 and thought these would be my glorious retirement years.)
Hopefully, by following your recommendations in the coming years, I’ll be able to stop working again and enjoy my leisure time.
I would love for you to write a book, or recommend one that is the best on understanding options and how to take advantage of them. I’ve seen one advertised by the guys on CNBC a lot, but I don’t know if it is just marketing hype or a good knowledge tomb.
And a couple of subscribers talk about Jeff’s advice on never looking back on a trade…
That was a valuable trading lesson. However, and of greater importance, it was a valuable lesson for living. Thanks.
While the points you raised were good ones, you are discounting one positive aspect of “looking back”… the ability to learn from mistakes. Now, I don’t mean if you buy a stock at $20 and sell it at $30, and then it goes to $34… that was a mistake.
But I mean more like, you bought an overextended stock before it pulled back and then sold at a loss. Or you set a stop too tightly, got stopped out, and then your stock or option zoomed up. That kind of thing.
Thank you, as always, for your thoughtful comments. We look forward to reading them every day. Keep them coming at [email protected].
In Case You Missed It…
- The exact day stocks could crash in October 2019…
The ONE WORD that will set off the crash… (Hint: It starts with the letter “o”)
- Which sector will be a bloodbath…
- Which sector will be the SAFEST PLACE to keep your money… and how it could help you make 100% to 200% gains along the way…
- The ONE STOCK you absolutely must avoid at all costs…