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Ugly market Monday.

Yesterday, the DOW dropped over 1000 points and the Nasdaq got smashed again and even closed right below its 200-day moving average.

The VIX made history with the biggest move from an intraday high to low in its history.

We are no longer in the market environment we were in May, because the Nasdaq had been falling in July, but how can big down days like yesterday happen?

First, I am not scared and do not think you should be either.

A rally should be starting very soon.

Panic selling like you saw yesterday in the markets happen when people are forced to sell out, because of falling prices. They happen because those on leverage get margins calls and people who thought they were smart and prudent investors when they bought something incredibly risky, realize they made a mistake and get out when their bets go sour.

Unfortunately, a lot of people go crazy and buy more and more at the top of a big rally and take big risks, using leverage, playing options, and the way things are now a lot of the crypto gurus even encourage people to gamble recklessly, by advocating for financial nihilism, and big market down days are the end result.

The big cap tech stocks and virtual crypto coins had all been falling for a month.

Forced selling happens at the end of stock market declines.

The gamblers get flushed out and the financial nihilists get their death wish.

When a market has a huge gap down, like we saw yesterday, and tries to rally only to fade into the close it’s usually due to margin calls.

I hadn’t seen a day like yesterday since the March covid market drop.

Now, I’m not going to try to predict every short-term gyration in the stock market here, but do think we can rally.

I already have the long positions I want and may do other trades in the next few months that I mentioned in my Sunday WSW Pro update.

No one can predict the exact moment the next real market rally will start out of this current mess and how it will exactly trade, so if you want to be a buyer you just have to hold your nose and buy something.

Just don’t listen to Bitcoin gurus who say everything is fine and you can just buy here and you will see Bitcoin go to one million and you will get rich. To play a rally in stocks or crypto here YOU NEED A STRATEGY.

It’s also best to avoid the hype stuff right now completely, we were seeing a rotation out of big cap tech and crypto had been fading for months. Other things are now better and it’s best to see what performed well yesterday.

I actually bought a little more gold myself on Monday morning right on the open. I did a small amount of selling on Thursday tooo, sending a WSW Pro update about it, and a small amount of buying Monday. In that update I explained the actual money management strategy I use in my account.

That strategy led me to do those trades without worry.

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And….WSW Pro Thoughts

On Monday, the indicator I wrote about again this Sunday gave the signal, during the trading day, although it will probably back off the zero level if the stock market does rally.

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