“Are we close to a market bottom?“
That’s one of the questions I’m hearing these days after the market’s six-week selloff.
Here’s my response…
“You know what you get when you pick bottoms?? Smelly fingers!!“
Ok ok… Sorry about that. I learned it from Bill, my old boss and mentor at the hedge fund.
But frankly, it’s very difficult to pick a market bottom. And besides, “the market” isn’t really a great measure for your investments anyway! Remember, there are so many areas of opportunity that don’t really show up when you look at a chart of the S&P 500.
Even so, the recent weakness for stocks has a lot of investors on edge. Some are this close to throwing in the towel and giving up. While others are ready to pour more money in (hoping that this is the point where the market will turn around).
I’ve got a better idea. And today, I’ll show you a project I’ve been working on to give me (and you) a better shot at profiting from this market pullback.
Don’t Pick the Market Bottom — Pick the Best Stocks!
There is always a bull market somewhere. (Jim Cramer doesn’t have a copyright to that statement – and it’s been around long before either of us started trading).
Just take a look at the difference between these two stocks!
Here’s the S&P 500 — what most traders consider to be “the market.”
Yep, the market has traded lower for a few weeks. But it’s still hard to see anything but a “bull trend” when looking at this long-term perspective.
Now, take a look at the S&P Financial SPDR (XLF) — a fund that tracks the financial sector.
This “market” hit a new all-time high this week (before the JPM earnings report caused a few financial stocks to pull back).
A lot of traders think the financial sector is “boring.” But there’s nothing boring about a market of stocks that’s hitting all time highs. This group of stocks is also investors plenty of income as well!
If you’re looking for other areas of strength…
- Energy stocks are surging thanks to higher oil prices.
- Solar stocks are on the move as well.
- Auto stocks (legacy names and also TSLA) have big recent gains.
- Hotel stocks are on fire with some at all-time highs.
I could go on, but you get the point. There are plenty of great opportunities that you can jump in to right now. And none of them require you to successfully pick the market bottom.
Keeping Track — and a Special Gift
If you’re like many traders, it can be tough to know where to find your next big trade idea.
I used to find myself falling back on the same handful of familiar stocks. And my profits often rose or fell based only on how well these particular stocks were doing.
Over the years I’ve become more organized and I keep lists of stocks set up in my trading platform.
LOTS of lists!
Since investing is my full time job, I don’t mind going through these lists on a weekly basis.
Recently, I decided to distill all of those lists into one actionable collection of key stocks. I think of this like my “all-star” roster of stocks setting up for a big move.
And since we’ve got a dynamic market with plenty of stocks rising — and plenty of stocks falling — I included stocks that are great BUY candidates, and also great SELL (or short) candidates.
After all, versatile traders can make money both from stocks that are rising, and stocks that are trading lower.
Today, I’m offering you my “20/20 Watch List” so you can see which stocks are at the top of my trading list. Hopefully, these these tickers will help you lock in profits from great setups that are in play right now.
This way, you don’t have to try to time the market bottom. Instead, you can keep a close eye on the trends that are emerging right now.
I’d love to know what you think about this list. Do you have questions or concerns about the specific names? Do you have a favorite stock you think should be included?
Leave a comment below and let me know!
Here’s to growing your wealth in ALL market environments. (And to not picking bottoms… ewww!)