October 25, 2021
Near-term Market Forecast: The market environment is modestly favorable for appreciation of these stocks in the weeks ahead.
The S&P 500 reached new highs last week lending more credence to the bullish market signal witnessed a week and a half ago. Meanwhile, the Nasdaq is just below the highs. The small cap Russell 2000 looks poised to make another run at finally breaking out of its 8+ month range. The S&P 500 is breaking out gradually as the NYSE advance/decline line is making new highs and the transport index is soaring towards the highs. Despite moving into the heart of earnings season, the VIX volatility index fell to test the lows of its 7 month range. The CRB commodity index pulled back briefly but is now staging another breakout into 52-week highs. Earnings growth expectations for the quarter have already increased from 26% at the start of Q3 earnings season cycle to now 31.5% for the S&P 500. A poor SNAP outlook on Friday has some investors wondering how good tech earnings will be this quarter and we can expect some bouts of volatility in the weeks ahead. The strategy is calling for holding the following 3 stocks until the next update:
This Weeks Stocks:
This week we have 3 new stocks. So, to follow the system, you would sell TSLA, GOOGL and ARCH and use the proceeds to purchase equal dollar amounts of SM, GS and CROX. 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 – SM
Optional Protective Stop-loss Point: $25.89 (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 – GS
Optional Protective Stop-loss Point: $349.49
Stock #3 – CROX
Optional Protective Stop-loss Point: $123.84
Another great week led by TSLA with a more than 17% gain. GOOGL was down about 3.5% on the unexpected SNAP guidance downgrade on Friday and ARCH was down about 1.5% from the entry point taught in the getting started video. Overall, another 4% for the strategy as the S&P 500 gained about 2%.
The normal chart types we use were down this evening but will be updated once the problem is resolved.
As we head into the heart of earnings season we can expect bouts of volatility. However, between now and the end of the year the strategy usually does very well.
Brian C Neall
Founder – Investtobefree.com
email: info@investtobefree.com