To The Moon

The S&P 500 staged a big comeback from its lows on Tuesday, but gave a lot of it back again before the closing bell as U.S. and China traded blows in a renewed trade feud. President Donald Trump criticized China for not buying soybeans late in the day, a comment that pushed the S&P 500 into the red to finish the session.

The S&P 500 closed down 0.2% to 6,644.31 in a wild day that saw the benchmark fall as much as 1.5% and gain 0.4% at its highs. The Nasdaq Composite was off by 0.8% to 22,521.70, although at one point it had fallen as much as 2.1%.The Dow Jones Industrial average closed up 0.4%, or 202.88 points, to 46,270.46 after gaining nearly 1% at one point. It was lower by 1.3% initially shortly after the open. Caterpillar led the gains in the Dow.

Stocks opened the day lower after China overnight moved to tighten its grip on global shipping, adding fuel to an already volatile global trade backdrop. China imposed sanctions on five of South Korea’s Hanwha Ocean’s U.S. subsidiaries. This will forbid organizations and individuals in China from doing business with the affected companies. The move, the Chinese government said, aims at strengthening China’s security.

U.S. Trade Representative Jamieson Greer then said that it depends on China’s next actions if the 100% additional tariffs threatened by Trump go into effect Nov. 1. Greer reiterated that the tariffs could be implemented even sooner.

The major indexes shook off the morning losses and the S&P 500 traded well into the green for most of the session.

But Trump hit China late Tuesday again saying the country is choosing to not buy U.S. soybeans in “an economically hostile act.” He also threatened to consider “retribution” such as a cooking oil embargo. Stock indexes pulled back from their highs into the close following Trump’s post with the S&P 500 ultimately closing lower.

At this point of time, we can see clearly that the market is a place highly influenced by politics and the impact it can have on business due to law and policies changes. I urged long term investors to be cautious and watch their portfolio and take action if necessary. For traders, do stay vigilant and alert to prevent falling into traps like the falling knives. During such times, the technical analysis may not be useful and therefore it is high risk to trade during such times.

Stay safe my fellow investors and traders.

$S&P 500(.SPX)$ $Lucid Group Inc(LCID)$ $Tesla Motors(TSLA)$ $Coinbase Global, Inc.(COIN)$ $XPeng Inc.(XPEV)$