YES ... You Can TIME the Market
Timing the Market
We had the market making another attempt to rally to day as a follow thru action from Friday. Once again the biggest negative was the volume. We need the institutions to give us a signal with their high purchasing power. They account for over 70% of the the daily trading volume in the market. This is a critical time for retail investors and traders to monitor their stock list. I published a list of 40 stocks in my blog post yesterday that were showing signs of institutional support. 25 of those stocks out performed the $QQQ today. This brings out the conviction that I have a list of successful leading stocks that institutions are investing in. Increased volume from today with the indexes $SPY and $QQQ rising convincingly later this week would produce a "Follow Thru" day. That is the timing signal that we look for to start initiating small starter positions in the leading stocks.
Here is a partial of the post that was published on May 3rd, describing the importance of acting decisively on a "Follow Thru" day. The last successful "Follow Thru" day of April 2nd allowed the $QQQ to attain over +60% within 21 weeks. Be prepared to take advantage of such timing signal.
Passive Investing With $QQQ
(Partial repost of the blog post of May 3rd)
"Write down exactly how you want to see your world, and visualize it. You have power in your thoughts. "
Bob Proctor (Expert in Law of Attraction)
"Freedom to be your best means nothing unless you're willing to do your best".
Colin Powell (Secretary of State)
We are experiencing a very successful "Follow Thru" day that we had with the $SPY on April 2nd, followed by another one with the $NASDAQ on April 6th. March was a horrible month. We were bombarded with the news in the media about the pandemic. If you paid attention to the news, you would have thought that the world was coming to an end. Those that distanced themselves from interacting on social media with every post on the pandemic, were most likely alert when the market took a hold within 10 days of reaching an all time low on March 23rd. We were all under lock down at that time and afraid to step out the door. Market in the mean time was flashing an opportunity for the retail traders to start stepping in gradually in the market.
Did you miss this opportunity ?
Fast forward 10 days from the low of March 23rd and suddenly we had a successful rally attempt by the 2 indexes - $SPY and $NASDAQ. Lot of retail investors were caught off guard and couldn't believe that the market was taking off again. Leading growth stock index $QQQ had fallen off almost -35% (1% on an average every day for 35 days). This was a fast and furious waterfall decline of these 2 indexes. Lot of investors doubted the "Follow Thru" day - including myself. Mr. William O'Neil (Founder of Investors Business Daily) has a rule which says:
You must buy something on a Follow Thru day
When in doubt, it would be a good idea to perhaps start out with a passive investment style of investing in $QQQ on "Follow Thru" day. It's a simple strategy as explained below:
- Invest in $QQQ at market open the very next day that IBD (Investor's Business Daily) declares a "Follow Thru" day.
- Reduce it to 1/2 position when IBD declares 'Market Under Pressure'
- Close out the entire position when IBD declares 'Market in Correction'
This strategy is explained in details on page A14 of the current May 4th edition of IBD print and digital newspaper.
If You had followed this strategy, the performance results to date from the April 3rd are:
- $SPY ... +12.77% (General Market Performance)
- $QQQ ... +12.99% (Growth Stock Index Performance)
- $XLK ... +13.98% (Leading Sector Performance)
Happy Trading!
AMIN