Coronavirus Update: Weekly Market Prep – March 23rd, 2020

Coronavirus Update: Weekly Market Prep 

Market Update:
With cases across the world exploding, the market ended last week with fresh multi-year lows and breaking below the support level at $235. We expect markets to continue towards $213 and $200 to the downside as governments continue to try and contain the spread of COVID-19. The VIX pared lower to 66, suggesting market volatility expectations calmed slightly. 10 year Treasury yields dipped below 0.90% after rallying as high as 1.25% mid-week. As cases continue to grow exponentially we see further downside on the markets and continue to position for shorts in the current environment. 

How to position in this market:
We are not adding to our DailyPlay positions today for the reasons that we laid out during our Friday morning session. We suggest continuing holding onto the SPY hedging trade to deploy portfolio hedging best practices. Our research points to using ETFs over single stocks during these highly volatile and illiquid market conditions. We are only short stocks that pass our stringent liquidity scans such as AAPL, and MU. We are updating our research this week to provide macro insights into the economic impact, please join us on Tues morning for our market research. 

Tuesday Market Outlook:

Join us Tuesday Morning at 9 AM EST for a market outlook session with Tony Zhang. Join Us