June 29, 2020
Near-term Market Forecast: The market environment is modestly favorable for appreciation of these stocks in the weeks ahead.
The market averages pulled back sharply last week and then started to bounce today. Both the Nasdaq and S&P 500 gave up over 2%. The small cap Russell 2000 gave up less than that and is leading on this rebound. The NYSE advance/decline line is starting to trend higher after a small pullback last week. The VIX volatility index continues to be elevated but generated a bearish candlestick pattern today. So perhaps we will see the VIX drop to more normal levels in the days ahead. The yield curve continues to be positive enough while not steepening or flattening much. We often see a mini July 4th rally into the holiday followed by a pullback sometime the following week but this year has been far from typical although very profitable for us so far. The strategy is calling for holding positions in the 3 stocks below until the next update:
This Weeks Stocks:
This week we have 2 new stocks. So, to follow the system, you would sell NFLX and ZM and use the proceeds to buy an equal dollar amount of TSLA and CHGG. 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 – VRTX
Optional Protective Stop-loss Point: $233.90 (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 – CHGG
Optional Protective Stop-loss Point: $51.94
Stock #3 – TSLA
Optional Protective Stop-loss Point: $783
The 3 stocks about matched the overall market over the past week and we are near the completion of another nice month for the strategy.
Its been another terrific year so far. Again, we often see a brief fourth of July rally this time of year but we can expect plenty of uncertainty ahead of 2nd quarter results and outlooks before earnings season starts around the middle of Juiy.
Brian C Neall
Founder – Investtobefree.com