That’s the question Dennis Dick asked on Wednesday’s PreMarket Prep in the wake of the market’s strong recovery from Friday’s sell-off.
“If we’re going to rally 30 handles every single time we get rumors of a vaccine how can you be short?” he said. “Because the rumors of the vaccine are going to trump all. And eventually they’re going to get it.”
Dennis, who’s been uncharacteristically bearish in the past few weeks as the coronavirus continues to spread, thinks we’re going to see the same type of market dynamics that we saw during the trade war with China.
“For a year and a half we were in a yo-yo market, but every time we’d get rumors of a deal we’d rally up. It happened 50 times. The new trade deal ‘deal-no deal’ is going to be ‘vaccine-no vaccine, it’s working-it’s not working.’”
For now, Dennis said he’s throwing in the towel on his bearish thesis as it relates to the coronavirus.
“If you’re going to get rumors of a vaccine every other day, how can you be short this market? Because that’s going to drive the market higher.”
Joel Elconin added it may be possible that the market won’t truly appreciate the impact of the virus until next earnings season when we get data on the current quarter.
“You’re coming off a good earnings season, so if there’s going to be a material impact, maybe we’re too early. Maybe it’s three months away until the next earnings season.”
For the full discussion on the market’s reaction to the coronavirus, click here.
Other Stocks Discussed On The Show
Stocks also discussed include:
- Walt Disney Co (NYSE: DIS) (click here)
- Snap Inc (NYSE: SNAP) (click here)
- Advanced Micro Devices, Inc (NASDAQ: AMD) (click here)
- eBay Inc (NASDAQ: EBAY) and Intercontinental Exchange Inc (NYSE: ICE) (click here)
- Twitter Inc (NYSE: TWTR) (click here)
- General Motors Company (NYSE: GM) and Ford Motor Company (NYSE: F) (click here)
- Macy’s Inc (NYSE: M) (click here)
- Take-Two Interactive Software Inc (NASDAQ: TTWO) (click here)
- Myomo Inc (NYSE: MYO) (click here)
- Airbus (OTCQX: EADSY) (click here)
- Tesla Motors Inc (NASDAQ: TSLA) (click here)
Fari Hamzei, Founder of Hamzei Analytics
Fari Hamzei, the founder of Hamzei Analytics, brings his wealth of knowledge on aggressive equity options and index futures trends.
Topics discussed with Fari include whether he’s short or long right now and his advice to traders going forward as the market continues to deal with the Coronavirus.
Fari’s full interview can be viewed at 18:50 in the video below or by clicking here.
Watch the full show or listen to the podcast below.
PreMarket Prep is a daily trading show hosted by prop trader Dennis Dick and former floor trader Joel Elconin. You can watch PreMarket Prep live every day from 8-9 a.m. ET here. The replay can be found on Benzinga's YouTube channel, and the podcast is on iTunes, Google Play, Soundcloud, Stitcher and Tunein.
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Disclaimer: All of the information, material, and/or content contained in this program is for informational purposes only. Investing in stocks, options, and futures is risky and not suitable for all investors. Please consult your own independent financial adviser before making any investment decisions.