Wednesday, 9 October 2013

Another triple digit drop due to the standoff

Dear Friends,

With the upper hand that Obama has, he don't seem to relent in his approach. His stand to Boehner, the House speaker is "You better do what I want or America shall perish". This time round, the upper hand Obama has is if Boehner does not relent, he would incur the wrath of the Americans.

We do think that in the end this will be resolved, but perhaps tearing the relationship again between the 2 parties. This can be resolved if Obama gets his way, and House representative Boehner does compromised.

Of course as a trader, I think by the dateline next thursday 17th Oct, there should be a compromise. In fact, it would be good to do some homework on the potential stocks that you can play. We feel that with the almost everyday drop, a resolution that is reached would cause a sharp rebound.

We do believe that by year end, Dow should reach all time high again, barring no tapering from the QE.

To summarise, do your homework on locating some good stocks now. If you still are uncertain whether to enter, wait for further action by the Republicans to show a compromise at the table.



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