The market was looking peachy, everything was grinding higher and higher as the day went on from big techs to cruise lines and then — the tweet. President Trump impulsively tweeted out that Congress will not be working towards another stimulus package until after the election. In my opinion, this will be better for the economy because the amount of money that has been printed in 2020 has been absurd, and later on it will catch up to us. But for the stock market in short, this tweet was extremely painful as all stocks were rising in anticipation of a stimulus deal, only for the idea of one to be shut down in one simple tweet.
For a man that loves the stock market, the President must know that his words bring weight to the market, and by blasting out messages like this over Twitter, fear sets in investor’s minds much faster. On that note, I do not believe the lack of stimulus should have affected the market this poorly, but it is the retail investors that cling to news reports to decide their long term buying and selling. This is why knowing the market is essential, especially with options trading. As the election comes closer and closer, people will be more on edge with Congressional decisions more than ever. It is important to trust both your trading and investing plans, and understand how outcomes make sense in other people’s heads, and not only your own.