You don’t. Even the algos and black boxes get caught like a deer in headlights when Donnie goes “all social” on their asses. The normal ebb and flow of the market gets disrupted and whacked when Donny grabs his keyboard and rips a tweet.
Last week, Trump launched his second president-elect shot over the bow at biotech and big pharma. In a period of about twenty minutes, $IBB cascaded from 286 to 275. The $XBI fell from 66 to 63.
Fun stuff, especially when I was long a bunch of bio. Bottom line, I did nothing, held my positions, and I ended up having a phenomenal week after the knee jerk reaction ended and more rational minds prevailed.
I’m a swing trader, so I let my positions breath and its not the first time I have had news go against me for a period. If you are day trader its harder, and you can have your lungs crushed in short order.
All politics aside, this promises to be an exciting next four years from an entertainment perspective, and it should all be good theater. So next time Donnie tweets, slow your roll and let the dust settle. And get used to it.
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