Wednesday was a shockingly bad day for American democracy. But as dramatic as the pictures were from inside the Capitol, the stock market barely flinched.
As I wrote Tuesday:
The index opened just above 3,700 support and that was all the confirmation investors needed that Monday’s selloff was truly dead. A couple of hours later, frenzied buying pushed prices 80-points higher and the S&P 500 was carving out yet another intraday record high.
Unfortunately, the afternoon unrest at the Capitol dampened the market’s mood slightly before the close. But finishing up 0.5% on a day when the U.S. Capitol is ransacked by an angry mob shows just what a bizarre period in history this is.
As I often say, if the market doesn’t care about these things, then as investors, we shouldn’t care about them either. While it seems like the world is crumbling around us, as long as stock keep going up, there is only one way to trade this. A market that refuses to go down on bad news is one that clearly wants to go higher. Stocks took a breather in December and now they are rested and ready to start charging higher in January. There is only one way to trade this stubborn strength.
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Jani Ziedins (pronounced Ya-nee) is a full-time investor and financial analyst that has successfully traded stocks and options for nearly three decades. He has an undergraduate engineering degree from the Colorado School of Mines and two graduate business degrees from the University of Colorado Denver. His prior professional experience includes engineering at Fortune 500 companies, small business consulting, and managing investment real estate. He is now fortunate enough to trade full-time from home, affording him the luxury of spending extra time with his wife and two children.