June 15, 2020
Near-term Market Forecast: The market environment is modestly favorable for appreciation of these stocks in the weeks ahead.
After a run into the better-than-expected jobs numbers, re-openings and dovish Fed, the market sold off late last week with the S&P 500 dropping over 8% within a couple trading days. A historic move lower. The small cap Russell 2000 led the way lower again with a more than 10% move off the recent swing high. The Nasdaq held up the best again. However, the market rebounded today with the small cap Russell 2000 leading with a strong bullish engulfing candle. This is shaping up to be a pullback within a longer-term uptrend. After a long slide lower after the extreme levels reached in March, the VIX volatility index rocketed back higher late last week before pulling back sharply today. The S&P 500 is rebounding strongly off of the top of the prior consolidation and 50 EMA. A good sign so far anyways. After steepening briefly, the yield curve flattened again after the Fed said the job market will not fully recover by the end of 2021. More concern about increased new cases of the corona virus in the US and elsewhere ignited a stay-at-home stock rally to help boost the market. The NYSE advance/decline line pulled back last week but is rebounding again. We will likely continue to see bouts of 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 no new stocks. So, to follow the system, you would do nothing. 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 – TSLA
Optional Protective Stop-loss Point: $748.90 (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 – ZM
Optional Protective Stop-loss Point: $158.90
Stock #3 – DXCM
Optional Protective Stop-loss Point: $289.40
After one of the worst weeks in months, the strategy soared last week and crushed the market again. The 3 stocks were led by ZM which, well, zoomed over 15% higher from the entry taught in the getting started video. The other 2 stocks were up big as well. Overall, those using the instructions in the getting started video were up over 9% while the S&P 500 was down over 4% and the Nasdaq was down about 2%.
Its been a terrific year so far. As we were saying last week, its hard to anticipate when the next strong run or pullback will start for this strategy. So being consistent over the years is key as can been on the performance chart over the past 8 years since inception.
Brian C Neall
Founder – Investtobefree.com