http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-government-shutdown Stock Trading in a Government Shutdown Political brinksmanship continues on Capitol Hill and a government shutdown appears eminent. Because volatile markets often promise the best profits we look at stock trading during a government shutdown. Let us look at both how both fundamental and technical analysis can help turn a profit in the coming days. The general consensus is that a temporary shutdown will hurt stocks but not very much. A longer term government shutdown might be a different matter. Failure to raise the government debt ceiling could cause measurable harm to the economy. The economic impact of shutting down the government comes to less than half a percent per month. That figure assumes that a month is the most extreme case before the boys on Capitol Hill grow up and act like leaders. If the debt ceiling is not raised government spending cuts will result in government spending cuts and something on the level of a four percent drop in the Gross Domestic Product. If the US government defaults on its debts all bets are off. History as a Guide to Stock Trading in a Government Shutdown When considering stock trading in a government shutdown look at the last time it happened. In the shutdown in the ninety-five to ninety-six fiscal year, the S&P fell nearly four percent but rebounded more than ten percent when the issue was resolved. By the time a deal was achieved to avert a debt default in 2011 the damage was already done and the market had discounted it. The Dow fell nearly fifteen percent and did not recoup those losses until six months later. On the other hand fiscal cliff worries took the Dow down over three percent but a deal resulted in an immediate rally back to the previous level. Using limit orders in day trading is a necessity in this sort of situation. Avoid being pulled into the flood when traders head for the gates. And then remember that when all is resolved there will likely be a nice recovery. Watch market sentiment and remember that in chaotic times a contrarian approach to day trading is often profitable. Longer Term Trends To the extent that the current impasse on Capitol Hill is symptom of a dysfunctional government we might expect to see more problems in the weeks, months, and years ahead. Trend following in stock trading can be profitable no matter if the market is going up or down. To the extent that the recurrence of possible debt default hurts the largest economy in the world traders may adopt a negative approach to the market and simply trade the adjustments as the market and the US economy slide into the abyss. At that point traders may choose to trade the US stock market but bank their profits in Yen or Swiss francs. An alternative would be trading and investing in foreign stocks such as the generally advancing markets of Latin America.

1. Stock Trading in a
Government Shutdown
By: www.ProfitableTradingTips.com

2. Political brinksmanship continues
on Capitol Hill and a government
shutdown appears eminent.
Because volatile markets often
promise the best profits we look at
stock trading during a government
shutdown.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

3. Let us look at both how both
fundamental and technical
analysis can help turn a profit in
the coming days. The general
consensus is that a temporary
shutdown will hurt stocks but not
very much.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

4. A longer term government
shutdown might be a different
matter. Failure to raise the
government debt ceiling could
cause measurable harm to the
economy. The economic impact of
shutting down the government
comes to less than half a percent
per month.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

5. That figure assumes that a month
is the most extreme case before the
boys on Capitol Hill grow up and
act like leaders.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

6. If the debt ceiling is not raised
government spending cuts will
result in government spending cuts
and something on the level of a
four percent drop in the Gross
Domestic Product. If the US
government defaults on its debts
all bets are off.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

7. History as a Guide to Stock
Trading in a Government
Shutdown
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

8. When considering stock trading in
a government shutdown look at
the last time it happened. In the
shutdown in the ninety-five to
ninety-six fiscal year, the S&P fell
nearly four percent but rebounded
more than ten percent when the
issue was resolved.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

9. By the time a deal was achieved to
avert a debt default in 2011 the
damage was already done and the
market had discounted it. The Dow
fell nearly fifteen percent and did
not recoup those losses until six
months later.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

10. On the other hand fiscal cliff
worries took the Dow down over
three percent but a deal resulted in
an immediate rally back to the
previous level. Using limit orders
in day trading is a necessity in
this sort of situation. Avoid being
pulled into the flood when traders
head for the gates.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

11. And then remember that when all
is resolved there will likely be a
nice recovery. Watch market
sentiment and remember that in
chaotic times a contrarian
approach to day trading is often
profitable.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

12. Longer Term Trends
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

13. To the extent that the current
impasse on Capitol Hill is symptom
of a dysfunctional government we
might expect to see more problems
in the weeks, months, and years
ahead.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

14. Trend following in stock trading
can be profitable no matter if the
market is going up or down.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

15. To the extent that the recurrence
of possible debt default hurts the
largest economy in the world
traders may adopt a negative
approach to the market and simply
trade the adjustments as the
market and the US economy slide
into the abyss.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

16. At that point traders may choose to
trade the US stock market but
bank their profits in Yen or Swiss
francs. An alternative would be
trading and investing in foreign
stocks such as the generally
advancing markets of Latin
America.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown

17. While you are fretting over how to
go about stock trading in a
government shutdown take a look
at ADRs on foreign stocks,
especially those from South of the
US border.
By: http://profitabletradingtips.com/stock-market-trading/stock-trading-in-a-
government-shutdown