February 8, 2021
Near-term Market Forecast: The market environment is modestly favorable for appreciation of these stocks in the weeks ahead.
The market quickly regained traction last week and the S&P 500 and Nasdaq both reached new highs within a few days of the recent low. It was only about a 5% to 6% pullback in a bull market. The small cap Russell 2000 is leading the way again with a larger move into new highs. Volume was significantly lower on the Russell and S&P 500 while higher on the Nasdaq as tech earnings continued to drive trading activity and many shorts throw in the towel. Its been a strong earnings season relative to expectations and earnings are now expected to be up for the quarter which is quite a turnaround. Earnings estimates for 2021 continue to trend higher and are now expected to grow over 26% for the S&P 500 according to Zacks. Good news as the ten year treasury yield only gradually moves higher for now. The NYSE advance/decline line has moved strongly into new highs. The yield curve expanded over the past week to over 1 which is good. The VIX volatility index is now sitting back on its support level and threatening to drop into a more normal range historically. We could continue to see bouts of higher volatility but the strategy is calling for holding positions in the 3 stocks below until the next update:
This Weeks Stocks:
This week we have 1 new stock. So, to follow the system, you would sell FB and and use the proceeds to purchase FLGT. 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 – SHOP
Optional Protective Stop-loss Point: $948.90 (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 – FLGT
Optional Protective Stop-loss Point: $122.87
Stock #3 – CROX
Optional Protective Stop-loss Point: $58.39
Wow. Its been another nice start to a new year. The 3 stocks portfolio was up nicely with SHOP leading the way with an over 16% gain since last Monday and CROX with a near 8% gain. FB lagged and was about flat from the entry point taught in the getting started video. It continues to be a terrific run over the past couple years. As we have been saying over the years, consistency with a great strategy is very important to have a shot at the big gains over time. You never know for sure when these big runs will begin and end.
Brian C Neall
Founder – Investtobefree.com
email: info@investtobefree.com