Always Right

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Yesterday's afternoon action was just another case of the stock market being right.

The headline was:

" Russia fires missile into Poland. 2 dead as missile lands in Poland. "

The subsequent commentary was that NATO article 5 would be invoked.

Article 5 states that the parties to the NATO treaty “agree that an armed attack against one or more of them in Europe or North America shall be considered an attack against them all.

This would essentially escalate the Ukraine Russia war into a World War.

While bullish for defense stocks, this would certainly spark a fear based sell off, with a commensurate spike higher in the volatility index. While we did get a quick move lower for stocks, and a 8% move higher for the VIX. By the end of the day the 'FEAR INDEX' was basically unchanged. As if the market knew this headline would not escalate the conflict at all.


While we did see the initial knee jerk spike in the VIX, those gains were reversed as the market correctly thought the missiles were not going to escalate the current situation.

We find out this morning that the missiles were indeed not fires from Russia.

" NATO chief and Poland's president say the missiles that killed two people "very likely" caused by the activity of Ukraine's air defense systems "

...almost as if the market knew that before everyone else.

The stock market is always right.

Known to most as Uranium Pinto Beans, Jason has more than 15 years under his belt of trading stocks, options and currencies. His expertise primarily lies in chart analysis, and he has a strong eye for undervalued stock. Because he’s got the ability to identify great risk/reward trades he usually enjoys taking the path less traveled and reaping the benefits from the adventure.

He is a co-founder of Option Millionaires, and he is best known for his weekly webinars with Scott, as well as his high level training webinars and charts found in the forums.

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