October 2020

The third-quarter was quite interesting. The stock market experienced net redemptions but continued to rally on relatively light trading volume. Nowadays, Citadel’s algorithms largely control stock prices. So the question that we are asking ourselves is if the stock market can rally on light trading volume, then what happens when trading volume soars?

As mentioned on a recent Navellier podcast, there is a lot of cash on the sidelines that is waiting to pour into the stock market once the uncertainty of the Presidential election is resolved once and for all. This is because we are in the midst of a V-shaped economic recovery as demonstrated by the Atlanta Fed (as of October 9, 2020) forecasting annual third-quarter GDP growth of 35.2%.