August 23, 2021
Near-term Market Forecast: The market environment is neither favorable or unfavorable for appreciation of these stocks in the weeks ahead.
After a pullback early to below the 50 day moving average, the Nasdaq rebounded strongly to new highs after a lot of negative sentiment already hit the market early in the week. The “buy the dip” mentality in this bull market seems to grow over time. As the Nasdaq closes above the prior highs, the S&P 500 briefly went into new highs today after nearly testing the 50 day moving average last week. The small cap Russell 2000 is starting to rebound off the lows in its 6 month consolidation but is still well below new highs and the 50 day moving average. The ten-year treasury yield continues to sag near 1.255% but a more dovish than expected Fed later this week could change that coupled with a peak in delta cases. Earnings came in very strong this quarter with growth nearly 100% year-over-year on the S&P 500. The S&P 500 dividend yield continues to be around the ten-year treasury yield. The NYSE advance/decline line is moving sideways now showing weaker breadth. After spiking to near 25 early last week, the vix volatility index is back within a normal range below 20 as it closed today near 17. The strategy is calling for holding the following 3 stocks until the next update:
This Weeks Stocks:
This week we have 2 new stocks. So, to follow the system, you would sell AAPL and WIRE and use the proceeds to purchase equal dollar amounts of GOOGL and KLIC. 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 – GOOGL
Optional Protective Stop-loss Point: $2274.00 (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 – KLIC
Optional Protective Stop-loss Point: $51.98
The 3 stocks were down slightly over the past week after a gap lower on APPS as the S&P 500 gained less than a half of a percent.
More volume and activity tends to come in after Labor Day and we can expect a modest level of trading activity until then although the Jackson Hole Fed meeting is later this week with potential surprises that could move the market.
Brian C Neall
Founder – Investtobefree.com
email: info@investtobefree.com