Friday Focus: End of World Edition

Friday Focus for Stock Options Traders at Option Millionaires

End of the world?  Yes.  That headline should be good for a few extra clicks at least  for those of you who didn't run immediately to grab your survival kits  and speed to that underground fall out shelter.   Someone will have to get them in 20 years and tell them it was all a false alarm.   We've had two 'one in every 500 year'  hurricanes in less than a month.  Last night a massive 8.3 earthquake in Mexico.  Wildfires are raging around the globe.  50 inches of rain in some parts of the world, in other parts a massive drought.

North Korea continues to threaten the world with nuclear weapons.  If this isn't the end of the world, then we have certainly reached some sort of bottom.  Perhaps it will be a V bottom.   World Peace will be reached, mother nature will take a siesta, and every politician will joyfully make love to each other amid falling rose petals.   The irony will be, when everything is good again, the market will finally turn south.  If the world is truly going to end, you might as well go out owning a lot of tech shares, which is probably why tech has been outperforming recently.  The bull market remains strong and when you look deep into where it is headed - it really boils  down to one of my favorite Mexican foods.

One day in the future, perhaps tomorrow, perhaps in 2025, this historic bull market will come to an end, and the 'massive' Central Bank infused debt bubble will burst like an over cooked Empanada.  It will be oily, it will be messy, and those not fighting for whats left , the scraps of meat and bits of the crispy outer shell,  will be faced with the reality of life without empanadas.

Now that I've scared you half to death, I'll let you in on a secret.... most supermarkets have pre-made empanada shells, usually in the frozen section.  Cook some seasoned  chop meat, insert into pre-made empanda shell, gently fry... and voila, your empanda nightmare is over.

And this is why the market continues on an upward trajectory.  An overcooked empanada is just another excuse to make more empandas.   More, more, and more.  It's the world we live in these days.  A world where everyone gets a trophy.  Everyone wins.  The stock market is following a similar path.  Over eight years of 'winning'

Each passing day is a day closer to the empanada bursting.  But again it could be a day in 2017 or a day in 2027.  There is no telling precisely when.   Policitcal Events, Central Bank action,   Terrorism, Currency intervention... remember when the Swiss decided out of the blue to unpeg their currency:

It’s All Swiss To Me

Every reason to sell has ultimately been a reason to buy.  Seemingly nothing can derail the stock market hitting new record highs.

Which brings me to one of the points I want to make....  Never get too comfortable.  Nothing lasts forever.  To borrow a small portion of a phrase utilized by the most bearish blog known to man, on a long enough timeline everyone is wrong.

All good things come to an end at some point.  Sometimes its at the peak of invulnerability, when the market looks like it will never fall again and sometimes its the other way around.   .  Last February as the market was off to its worse start in history, sentiment was at a nadir, which marked a great buying point.

Always remember while your enjoying that perfectly crafted  empanada, it's not always going to taste this good.  Nothing last forever.  And on a long enough timeline even a greasy overcooked empanada becomes inedible.

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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