August 16, 2021

 

Near-term Market Forecast: The market environment is neither favorable or unfavorable for appreciation of these stocks in the weeks ahead.

The S&P 500 continues to very gradually move into new highs while the Nasdaq lags and the small cap Russell 2000 continues to be below the 50 day moving average well off the highs.  Earnings are now expected to be up over 92% for the quarter with nearly all the S&P 500 reporting.  Sales are now expected to be up nearly 25%.  Earnings continue to catch up with the S&P 500 valuation.  Meanwhile, the S&P 500 dividend yield continues to be around the ten-year treasury yield providing support.  The NYSE advance/decline line is finding resistance near the highs but continues to be just below them.  The vix volatility index is still back within a normal range below 20 as it closed today near 16.  Despite the geopolitical and recent covid news, volatility remains subdued as buyers continue to come in on pullbacks as we saw today.  The strategy is calling for holding the following 3 stocks until the next update:

 

This Weeks Stocks:

This week we have 1 new stock.  So, to follow the system, you would sell APPS and use the proceeds to purchase AAPL.  If you are just starting, you would buy equal dollar amounts of all 3 stocks when the market re-opens in your risk-capital account dedicated to this system.  Be sure to view the complete introductory video before getting started.

 

Stock #1 – AAPL

Optional Protective Stop-loss Point: $121.79 (Be aware that a tighter stop-loss will likely severely reduce performance over the long-term based on back-testing for this strategy. See upgrade and performance video for further information and insight on optional stop-loss orders.)

Stock #2 – FNF

Optional Protective Stop-loss Point: $39.94

Stock #3 – WIRE

Optional Protective Stop-loss Point: $63.92

After a big beat and raise quarter, APPS took a nose dive despite that, positive commentary and outlook in the press release and the low valuation.  Go figure.  The near 5% move higher the prior week in the portfolio was met with a 5% move lower this week after the move higher in FNF and WIRE.  Typical wishy-washy early August action as volume decreases despite the plethora of earnings reports.

Fortunately, the back half of August is often pretty good for the strategy.  But seasonality has a poor track record this year in the market as “sell in May” and the “late June swoon” failed to materialize.

 

 

 

Brian C Neall
Founder – Investtobefree.com
email: info@investtobefree.com