I told you so.
I titled yesterday's post "Meaningless Monday Market Movement" and, despite the gyrations, it certainly was. Now the real action begins and we'll see if we can hit those bounce lines (see yesterday's post). There was apparently a suicide bomber in Instanbul this morning and many people were killed at a market but, as is often the case these days, the markets are shrugging it off and moving higher – up about 1% at 8am in the Futures.
We did lose the 1,050 line on the Rustle and, if we don't get it back today we are DOOMED!!!, but I think "THEY" have other plans. Still, that line will be critical to watch this morning – weakness there (or NYSE 9,600) will mean it's another one of those narrow, manipulated rallies where the headline stocks are run up to get the suckers (that's you) to think it's time to buy the f'ing dip again.
However, I don't want to confuse the issue – I think we're oversold and I think we should get a nice bounce here. I think a lot of stocks have over-corrected and I think there are plenty of good things to buy out there – that's why we published a Watch List for our Members on Thursday with 24 stocks we like. The idea of a Watch List is that, when the market does turn back up, we can pick up the lagging stocks on our list. No need to jump in early – usually 4 or 5 of 24 value stocks at least will be slow to regroup – even in a huge rally.
American Express (AXP) is on our list. We like them at $64 but, as you know, we teach our Members never to pay retail prices for a stock. As I mentioned yesterday, when the VIX is high it's a great time to sell puts and you can sell the AXP 2018 $55 puts for $5, which would net you in at $50 (23% off the current price) if AXP is below $55 (15% below the current price) come Jan 2018. If AXP does not fall 15%, you keep the $5 without ever having to own the stock.…