Operation Warp Speed? Markets overextend with Pfizer vaccine news…

Well, we got some pretty big news at the beginning of this week… 

American pharma giant Pfizer and German drugmaker BioNTech announced that the vaccine the two companies have been developing together has proven effective with a 90% success rate

This is amazing news, obviously. We have a vaccine that can help us get out of this pandemic… 

Or do we? Anyhow, the markets have been on a wild ride. On Monday, we saw new highs in the S&P 500 for the year. 

Just brimming with opportunities it would seem… 

But then by Tuesday, Amazon saw a drop of about 200 points from its high on Monday. 

So what’s going on exactly? 

One thing is for sure: this Amazon chart does not bode well for current trends that we’ve been seeing. 

The Market is a Bit Overextended 

I’ve been saying all along that volatility would be expected this time of year. It seems like the dust hasn’t completely settled with the election. 

When there’s volatility, the key is to not get overwhelmed and try to look too far ahead into the future. 

The most important thing to remember is to trade where the odds are in your favor. 

It seems like the markets got a little overexcited with the vaccine news. As if the news of the vaccine’s efficacy alone ended the pandemic altogether. 

That didn’t happen. We are closer to the end it seems. But there’s still a ways to go. 

In fact, there was (and there continues to be) quite a bit of confusion about this . 

While Pfizer did make a deal worth nearly $2 billion with the U.S. federal government to provide 100 million doses, the Pfizer vaccine wasn’t actually part of Operation Warp Speed. The company spent its own money in order to develop the vaccine. 

See, something like that really doesn’t mean much, but it’s a reminder of how much we don’t know. I know I sure have some questions about the vaccine and how it’s going to be distributed. 

By the way this week has gone, it seems like the markets have a few questions as well. 

Trade Where the Odds are in Your Favor

Once again, we are reminded of the importance of taking it a day at a time. We can’t try to look too far into the future. We have to remember to trade where the odds are in our favor.

Right now, that’s trading the reference bars: that’s the only safe bet right now. (Check out this report that I recently shared with my TBUZ TV subscribers.) 

In the meantime, what we have to do is to judge this just a little bit. We know the market is a little bit overextended right now, and we have to let some dust settle. 

There are going to be some opportunities – and when they come, we’ll be ready to take advantage of it. 

You all have a great day. And like I always say: I’ll see you on the flip side. 

Talk soon,