March 14, 2022
Near-term Market Forecast: The market environment is unfavorable for appreciation of these stocks in the weeks ahead.
The Ukraine situation continues to deteriorate and the omicron variant is starting to spread in key industrial areas of China in earnest. Two situations not likely to help inflation and the probability for higher interest rates going forward from the Fed. Both the S&P 500 and Nasdaq are starting to break down out of their large head and shoulders patterns ahead of the key Fed statements and first rate hike on Wednesday. The Nasdaq and small cap Russell 2000 are solidly into bear market territory with the S&P 500 not too far behind. Oil cratered from $130 to $100 a barrel within a few days and the CRB commodity index, a broader index of commodities, is now pulling back and consolidating the recent strong gains. The VIX volatility index continues to be very high and closed today near 32. The 2/10 year yield curve continues to be flat and closed at .27 today. Still close to an inversion. 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 ROCC and SBSW and use the proceeds to purchase equal dollar amounts of TGT and BLDR. 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 – TSN
Optional Protective Stop-loss Point: $75.89 (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 – BLDR
Optional Protective Stop-loss Point: $55.94
Stock #3 – TGT
Optional Protective Stop-loss Point: $169.83
All 3 stocks had bad news releases that came out over the past week after a good start. Oil cratered suddenly, gold pulled back sharply and TSN had a downgrade. The strategy was down another 9% over the past week while the S&P 500 was down about 1%. This makes this one of the worst drawdowns for the strategy over the past 10 years.
Brian C Neall
Founder – Investtobefree.com