Volatility returned to the markets in the last week as the VIX spiked 38.5% and the S&P 500 experienced a 7% decline.
With the economy still struggling, investors are wondering if this is the start of another stock market crash.
But it could also be just a bit of “fat trimming” in a longer-term bull market poised to go higher.
Volatility returned to the markets in the last week as the VIX spiked 38.5% and the S&P 500 experienced a 7% decline.
With the economy still struggling, investors are wondering if this is the start of another stock market crash.
But it could also be just a bit of “fat trimming” in a longer-term bull market poised to go higher.
Here's everything you need to know now...
Since stocks crashed 36% between February and March, a new rally has recaptured half of the losses in the Dow.
The Nasdaq is also back to even on the year.
That would normally be welcome news.
But a rally like this one could actually set up a second stock market crash in 2020.
Here's why you shouldn't buy the bounce.
By yesterday's close, stocks had gained 21% in the last three days, making that the shortest bear market on record.
The Wall Street Journal coronated the end of the three-day rally by declaring that "A new bull market has begun."
Now that we're at the start of a new bull market, it's time to dive into stocks again, right?
Not so fast.
This has all the signs of a classic bull market trap.
It's something we've been warning investors about this week.
"Head fake" rallies are a common feature of bull markets.
This one's no different.
All signs point to markets and the economy getting even worse from here...
Wall Street is full of old saws.
There is one for just about every occasion, including when it's finally time to take advantage of this current bear market and buy.
And one you're going to hear over and over soon is "stock market capitulation."
We've seen it all before. A positive headline sends stocks rallying, only to see them tumble down to new lows.
And it's going to happen this time too.
You see, this is all part of a pattern after a stock market crash. Short-lived rallies collapse into lower lows.
Take a look for yourself and find out what's coming next...
The coronavirus crash has decimated stocks, but the real risk is that the coronavirus could cause a recession.
That's where investors need to focus their attention right now.
Stocks simply aren't going back up until the economy recovers.
While we might not hit the technical definition of a recession, Americans are already experiencing the effects of one.
But there's a silver lining...
We don't need to tell you it's been a rough few weeks.
You know trading has been halted four times in the last week, you've watched your 401(k) evaporate, and you're likely reading this from home as offices, restaurants, and other spaces are shutting down.
What you want is to cut through the headlines and hysteria and find out exactly what you can do.
Money Morning has assembled a team of experts with more than a century of market experience.
This isn't their first time around the block.
And they're here to help you.
There certainly is plenty to worry about these days but if you listen to the media and many so-called experts, you would think that the sky is literally falling.
Make no mistake, there is real risk here, but don't let the news make you panic.
Today, we're going to look at past bear markets to see if we can find opportunities in this one...
There are three major things that could drive this market even lower...
It appears that people are only focused on the first floor.
But there's far more danger on the horizon, no matter what the Fed does.
I want to show you the three basic factors that could see this financial crisis lead us from a top-to-bottom drop of more than 40%.
After stocks had their worst day since the 2008 financial crisis, they rallied back hard Tuesday.
In fact, the Dow's 1,100-point gain was its third largest daily point gain ever, behind only two days last week.
The question investors have now is whether that was the end of the correction or just a "dead cat bounce."
Fears sparked by the coronavirus outbreak have whipsawed stocks.
But the current outbreak could just be the "first wave" of a seasonal disease that will strike again in the fall. If that happens, it will deliver another gut punch to markets.
For investors, it's a lot to digest.
That's why it's important to monitor the situation and above all be prepared no matter what happens.
Here's how you can navigate this treacherous waters...
Just last month, the Dow Jones Industrial Average fell by over 1000 points in a single day for the first time.
Then Monday, it was over 2000 points in a single day. If you're wondering if this is the start of a 2020 stock market crash, you're not alone.
But that's not what is happening here.
In fact, there's a silver lining...
Stocks fell so fast today - 7% in less than an hour after markets opened - trading was halted for 15 minutes.
To many outside observers, that might look like the stock market crashed.
Of course, if you've watched your 401(k) and retirement accounts lose 17% of their value in a matter of days you don't care what the experts call it.
What you do next is the most important factor here, not whether this is officially a stock market crash or not.
We know this is a time of uncertainty.
Watching your money evaporate is nauseating.
Fortunately, you are in control.
The longest bull market in history could be coming to an end. The Dow lost 1,000 points on Feb. 24 (Monday) alone, and lost 12% that week.
Though it recovered some of those losses, many investors still think the worst is yet to come.
Are they wrong?
Or will the coronavirus cause a recession?
The Dow lost over 1,000 points on Monday.
South Korea announced 700 cases of coronavirus.
Turkey closed its border with Iran. Italy is in a panic.
But that doesn't mean you have to panic yourself.
We have an options trading strategy that could double your money in a week if things continue as they have.
Tom Gentile, Money Morning's Options Trading Specialist, helped our readers make 360% gains from the most recent drop.
He shared the pick with our readers last week.
And we're going to use Tom's strategy to make even more profit.
