US Politicians getting in the way of new highs ?

US politicians are living up to every body's negative expectations. They are using every tactic in the book to ensure that a very weak agreement is in place until the last minute of Aug 2nd.

14.3 trillion dollars debt ceiling needs to be raised.

Market expectations was for $4 trillion in spending cut, but the last minute cold feet is heading towards a $2.4 trillion spending cut ?......this weak agreement MAY end up costing everyone as US debt may be downgraded to AA......

There never is a good time or willingness to deal with deficits in US, so a compromise to the lowest number is acceptable for their political gain?

Why so much focus on US politics ?

Because it MAY affect US & World markets......you & me & everyone else around the world.

Asian markets & futures will be first indication of how this last minute "lose lose agreement" is viewed.......

Aside from this, markets were on their way to making new highs.

Nasdaq was all set to pierce 2887.75......RSI in Nasdaq is 61.09

VIX was on its way down

Depending on the reaction to any deal, Gold MAY get its last jump to new highs......

Earnings are in overdrive gear with BIDU, NFLX,TXN & BRCM on Monday AH.....I am expecting positive earnings from BIDU..NFLX is a big ?

As usual, focus should be on making money.....so IF reaction is negative to budget deal, buy good stocks which is being sold off.

IF reaction is positive to budget deal then "sell on the news" is a good strategy.

@ this level, it is a traders market.Booking profit is a wise strategy & buying into other opportunities is a good idea.

Exposure needs to be slightly higher than 50% & reduced further once we move higher towards new highs.

IF you can find ways to make money, then take a position.

It does NOT matter where indices are heading, focus should always be "to make money"

Q3 earnings report may be trough, then a strong Q4 guidance for Christmas sale.

Try to book small gains from hereon until Q4.

Summer is generally dull for investing, so tinkering with small exposure is highly recommended.

Good luck with your OWN understanding of market & your individual stocks.

BLOG does NOT give buy or sell.

Saleem