Russell 2000 Ishares ETF

Market Correction

The Autumn Correction Is in Full Swing - Here's How to Profit

It only feels as though the media have said everything there is to say about the market over the last three weeks of this downturn.

The talking heads are still missing something – something they're just not keen enough to grasp about all of this. But, to be fair, the big news is hard to ignore.

After all, the late week phase of the pullback took all the major indexes back to, or just below, their break-even levels as far as year-to-date returns are concerned.

That's something that should scare the hell out of investors. However, I'm still seeing signs that there is a little too much bullish enthusiasm for stocks to call that "the bottom."

Even accounting for Thursday's bounce, sell-offs have shaved just about 10% from the S&P 500's October high. In doing this, the benchmark index crashed right through the plate glass window of its 50- and 200-day moving averages. It's still sitting below those lines as of Friday midday.

So it's "official" in my book, for what it's worth: The market is embroiled in an intermediate-term bearish pattern.

Now let me show you what to do about it...

Trading Strategies

Why Bears Will Enjoy "Best in Breed" Profits This Month

The "September slide" this past week has been excellent for my paid-up subscribers – even some positions that had been sluggish moved higher – because we were well prepared for stocks to gap lower.

We closed out two more winners in Western Digital Corp. puts, and on the "other side" of the market, DSW Inc. calls for a nice 174% and 78% in gains.

Those results certainly show how our proven "Best in Breed" (BIB) stock-picking methodology works hand in hand with portfolio balance. A mix of calls, puts, bullishness, and bearishness has helped us capitalize on the market's recent swings.

Right now, BIB is showing retailers as an area of strength for the next couple of months, which is why I've been so bullish on them here in Money Morning recently – just look at our DSW position. 

Meanwhile, BIB bull's-eyed the technology sector as a laggard, and sure enough, it's no longer leading the market higher. Puts in WDC yielded a huge profit. And our other bearish plays in the sector are bouncing back in our favor.

Now let's take a look at what the market's showing us for the next four weeks or so...


The Stock Market Could "Turn Over" Any Day Now - Here's What to Do

The big indexes are trading at just about the same levels they were three weeks ago.

My experience tells me this means the market is at a tipping point as it searches for an ultimate direction. Seasonality and sector rotation are in play right now – as I've been saying for the past few weeks.

Change is in the air; market leadership is changing hands.

My job is to make sure you're on the right side – now, and when the "flip" happens… Full Story

No need to worry - here's what to do.

Trading Strategies

This Seasonal Surge Can Bring In Huge Gains, but You've Got to Move Right Now

Wall Street loves the prospect of a tax bill landing on the president's desk this weekend. We're within striking distance of Dow 25,000 as I write this.

I think the markets are going to continue to soar from here, allowing for the prospect of a small pullback when and if traders try and "sell the news" of the tax bill becoming law.

More gains ahead… but some gains will be bigger than others, thanks to the "January Effect" – a phenomenon distinct from the "Santa Claus rally," but which is happening earlier and earlier every year.

I'll tell you all about it - and name the asset that's about to go ballistic because of the effect...

Trading Strategies

Friday's Big Dow Drop Opened Up a Big, Month-Long Opportunity

The trading on Friday, Dec. 1, started off with "business as usual."

The grinding bull had been moving sideways, because the markets had Senate tax reform progress "baked in" for the past few "up" days. Still, the prospects were looking good, and most market watchers were anticipating a move higher.

Then I saw the major indexes start to tank.

A quick check of my fastest news feeds gave the answer: ABC News was reporting that former national security adviser Michael Flynn was prepared to say that President Trump "directed him to reach out to Russian officials during the campaign."

The market continued to drop.

And - snap! Just like that, we were in the grip of a very profitable extreme - one that's only poured fuel on my favorite December recommendation...

Trading Strategies

How to Profit as Volatility Comes Roaring Back

Last week, I showed you how powerful the market's post-crisis "narrative," or its overarching driving theme, can be.

Since the November 2016 election, the narrative has revolved around the administration's "Big Three" initiatives: reduced taxes, reduced regulation, and increased infrastructure spending. It's a heady brew that's driven some 13% in gains since the election, and any news that supported the idea of the "Big Three" sent the markets higher.

But… I also talked about how that narrative could be changing – in a big way.

It's pointing to some huge opportunities in the days and weeks ahead as an "old friend" comes back into town...

Trading Strategies

The Markets Have a Present for Us After the Holidays, Too

The holiday season has a different vibe, doesn't it? The pace around us quickens, expectations rise, and despite the commercialization, at least some of the joy and optimism of the season seeps in around the edges.

Personally, this weekend, I'll be expecting my kids home from college and med school, and family members are already calling to arrange visits. They're even calling for some seasonally appropriate snow this weekend at my home in Delaware.

The markets themselves usually manage their own form of "joy" at this time of year. The optimism of the populace seems to bleed over into stock prices.

That's no idle speculation, either – history shows that the S&P 500 has provided positive returns in a whopping 49 of the past 65 Decembers. That's a win rate just north of 75%.

That's a strong result, but I've got a play in mind that's even more impressive...