Trading Strategies to Combat Financial Sector Woes
Future of Wealth Head Trader Lance Ippolito joined Midas Letter to discuss the “do’s” and “do not’s” for traders in today’s current economic climate.
Even with the volatile nature in the stock market since the onset of the COVID-19 crisis, internet software companies inside the technology sector have experienced 52-week highs. The e-commerce titan Amazon (NASDAQ:AMZN) hit 2,313.88 today, a new all-time high, and is up 22% on the year. This is in stark contrast to the rest of the market as the S&P 500 has declined 13% in the same time horizon. JD.com (NASDAQ:JD), the e-commerce company and retail infrastructure service provider in the People’s Republic of China, also hit a new 52-week high.
Although there are companies achieving success in the market, particularly in e-commerce, the Head Trader does not necessarily believe, in general, there are signs of the economic weakening stemming from the Coronavirus pandemic.
The financial sector has been under amounting pressure this week from weak earning reports and poor outlooks as banks are setting aside funds to deal with expected loan losses. The bleak outlook in the stock market has seen investors seek safety by not investing. People are feeling the need to hold onto their cash. Cash levels in the US have spiked to 5.9% – which is the the highest level seen since 9/11.
Watch the entire interview to see what Lance is trading and how to make money as these key economic themes unravel.
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