Hope you are having an awesome Happy Father’s Day with the fam.
Just wanted to send a list of bullet points of things that I think may be helpful for active players in the market in the coming week or 2.
NQ (Nasdaq-100) is my primary market but I am starting to get nervous about how much it has risen. Obviously being in NQ or QQQ ETF top 10 names has been a huge boon, but I am on watch for other opportunities too.
I will be on watch for the DOW and the Russell 2000 to have another “sector rotation” event in the coming days and weeks. What this looks like is tech weakness and relative strength in the Dow and Russell 2000. This typically lasts for a very short period of time (sometimes just a day).
I will be on watch for a -1% red day for NQ coming in the next 2 weeks or so. I do not know if we will close -1%, but I expect a -1% intraday peak to trough move before month end. Given this is a -180-200 point move in NQ, this is most applicable to Intraday players. This means scalping bullish NQ opportunities would ideally try to enter after these dips take place (if they do) in the coming weeks. Please avoid tech FOMO.
Europe/Canada/Hong Kong have cut their 2024 gains in half over the past 1-2 weeks. It is best to not think the S&P 500 is invincible (it isn’t, nothing is invincible). Momentum still favors U.S. upside, but beware of intermittent unwinds which can be violent.
Stocks that I think have the most potential for a violent rally are the names that have been beaten up the most YTD. I will have a list of such stocks for Members this week.
However, unless the fundamentals are strong, the duration of their rally will be short and will come back down after any pump.
Good examples of this include the bullish sequence of LULU where they pumped it from 300 to 350, only to dump it back to 300 again. The window of opportunity for a rally once sector rotation comes is definitely there. But again, this window of opportunity is a window.
Windows open, and then they close.
I still think tech has some more modest upside potential but I am watching to see if tech leadership rests in the coming weeks in favor of sector rotation opportunities. Several of the QQQ’s top 10 stocks are approaching my Bull Case in my DCF Conclusion Studies.
-Larry
P.S. - If you enjoyed this note, share w your network. Join as a Member. It has been an incredible year for our strategy, and I plan to keep it an incredible year even if NQ comes back down (which I honestly hope it does to reset bullish opportunities).
Happy Father’s Day! Enjoy the rest of your weekend.
Thank you for reading Letters from Larry: U.S & China Investment Strategy. This post is public so feel free to share it.
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Happy Father's Day! A Preview into the week ahead.
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Hey Everyone,
Hope you are having an awesome Happy Father’s Day with the fam.
Just wanted to send a list of bullet points of things that I think may be helpful for active players in the market in the coming week or 2.
NQ (Nasdaq-100) is my primary market but I am starting to get nervous about how much it has risen. Obviously being in NQ or QQQ ETF top 10 names has been a huge boon, but I am on watch for other opportunities too.
I will be on watch for the DOW and the Russell 2000 to have another “sector rotation” event in the coming days and weeks. What this looks like is tech weakness and relative strength in the Dow and Russell 2000. This typically lasts for a very short period of time (sometimes just a day).
I will be on watch for a -1% red day for NQ coming in the next 2 weeks or so. I do not know if we will close -1%, but I expect a -1% intraday peak to trough move before month end. Given this is a -180-200 point move in NQ, this is most applicable to Intraday players. This means scalping bullish NQ opportunities would ideally try to enter after these dips take place (if they do) in the coming weeks. Please avoid tech FOMO.
Europe/Canada/Hong Kong have cut their 2024 gains in half over the past 1-2 weeks. It is best to not think the S&P 500 is invincible (it isn’t, nothing is invincible). Momentum still favors U.S. upside, but beware of intermittent unwinds which can be violent.
Stocks that I think have the most potential for a violent rally are the names that have been beaten up the most YTD. I will have a list of such stocks for Members this week.
However, unless the fundamentals are strong, the duration of their rally will be short and will come back down after any pump.
Good examples of this include the bullish sequence of LULU where they pumped it from 300 to 350, only to dump it back to 300 again. The window of opportunity for a rally once sector rotation comes is definitely there. But again, this window of opportunity is a window.
Windows open, and then they close.
I still think tech has some more modest upside potential but I am watching to see if tech leadership rests in the coming weeks in favor of sector rotation opportunities. Several of the QQQ’s top 10 stocks are approaching my Bull Case in my DCF Conclusion Studies.
-Larry
P.S. - If you enjoyed this note, share w your network. Join as a Member. It has been an incredible year for our strategy, and I plan to keep it an incredible year even if NQ comes back down (which I honestly hope it does to reset bullish opportunities).
Happy Father’s Day! Enjoy the rest of your weekend.
Thank you for reading Letters from Larry: U.S & China Investment Strategy. This post is public so feel free to share it.
Share