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A new, worrying narrative is popping up in the financial media... In short, many so-called experts have started recommending "bottom fishing."

The 'Most Expensive Sport in Investing' Is Too Popular Right Now By Karina Kovalcik, senior quantitative analyst, Chaikin Analytics A new, worrying narrative is popping up in the financial media... In short, many so-called experts have started recommending "bottom fishing." Bottom-fishing is exactly what it sounds like. It's the practice of buying supposedly cheap and beaten-up companies in hopes that they'll turn around and lead you to profits. But of course, it doesn't always work. That's why my mentor and Chaikin Analytics founder Marc Chaikin often describes this practice as "the most expensive sport in investing." The problem is, most of these folks don't think they're bottom-fishing. They believe great research is leading to these opportunities. In fact, a very dangerous trend is unfolding... Investors are using technical analysis to justify buying "cheap" stocks. But as we'll cover today, an attractive technical setup isn't enough reason to buy a stock... Recommended Links: 'THIS WILL DEFINE MY LEGACY' After four decades of preparation... Dr. David Eifrig stepped forward with the most important announcement of his life. If you've EVER followed his research... or simply don't want to miss what Doc calls the "the biggest opportunity I've ever seen... in any market... any asset... anywhere"... you need to see what he revealed last week. Full details here. How I Saved My Retirement and Stopped Worrying About Money Forever I never worry about money problems or my retirement income, no matter what happens with politics or the markets. I've got legal obligations on my money that stocks can only dream of. My advice? Take this ONE simple step today. In this case, I'm referring to a couple of things when I say technical analysis...   1. Charts showing stocks at five-year lows (or other long-term lows) 2. Charts showing stocks in "oversold" territory Seeing one of these two things in a particular stock isn't enough on its own. After all, our Power Gauge system analyzes and weighs 20 different factors for a reason. That's especially true when it comes to making a "value" based decision. Remember, a low share price doesn't make something "cheap." Something needs to signal a pending turnaround as well. And while I hate to say it, the reality is... the current signals are pointing in the wrong direction for most companies. Before you go bottom-fishing, you need to keep a few things in mind... Inflation is at a 40-year high with no indication of letting up soon. The cost of energy has come down a little bit recently, but prices for all types of other things haven't. U.S. gross domestic product ("GDP") declined last quarter. And the latest estimates point to another decline this quarter. If GDP declines for two straight quarters, we'll officially be in a recession. And even though companies are reporting better-than-expected earnings recently, they're still poor. As my colleague Pete Carmasino says... "Bad earnings are bad earnings, even if they're less bad than expected." Even great companies struggle in this type of environment... For example, input costs are soaring in the manufacturing space. Some companies are facing labor shortages. And others are facing parts shortages. So when people try to say that the market can't go much lower... ignore them. Even if a great company's stock is down 30%, it can still fall another 30%. And that's especially true given the current state of the economy. It doesn't matter if a stock is at a five-year low, a 10-year low, or even an all-time low. The bottom line is simple... Share price alone doesn't make a stock cheap. And wishing for a bottom doesn't make it happen. It takes more than just technicals to make this kind of evaluation. You need to be aware of the fundamentals, too. For that type of research, I lean on the Power Gauge. The system evaluates the 20 most powerful factors on Wall Street. They're the perfect mix of technical, fundamental, earnings, and expert-related indicators. But whatever system or approach you use, make sure it's more than just a variation of "I'm buying this because the price is a lot lower than it was a few months ago." In other words... don't go bottom-fishing just because someone else told you to do it. And definitely don't go bottom-fishing just because a stock looks cheap on the chart. That's the most expensive sport in investing. Good investing, Karina Kovalcik Market View Major Indexes and Notable Sectors     # Hld:     Bullish     Neutral     Bearish Dow 30 -0.42% 5 17 8 S&P 500 -0.92% 53 318 128 Nasdaq -1.75% 19 50 30 Small Caps -1.61% 314 1054 456 Bonds +1.68% Utilities +1.37% 0 28 0 — According to the Chaikin Power Bar, Large Cap stocks are more Bearish than Small Cap stocks. Major indexes are mixed. *  *  *  * Top Movers Gainers HCA +11.43% SLB +4.28% PPG +3.91% PM +2.50% DHI +2.06% Losers SIVB -17.15% STX -8.11% META -7.59% RHI -6.83% NUE -6.74% *  *  *  * Earnings Report Reporting Today Rating Before Open After Close CDNS BRO, PKG, TXN, UHS NEM ARE, FFIV, NXPI, WHR No earnings reporting today. Earnings Surprises TWTR Twitter, Inc. Q2 $-0.08 Missed by $-0.22 SLB Schlumberger Limited Q2 $0.50 Beat by $0.10 HCA HCA Healthcare, Inc. Q2 $4.21 Beat by $0.50 RF Regions Financial Corporation Q2 $0.59 Beat by $0.06 AXP American Express Company Q2 $2.57 Beat by $0.16 *  *  *  * Sector Tracker Sector movement over the last 5 days Discretionary +6.84% Materials +4.19% Industrials +4.16% Energy +3.73% Information Technology +3.66% Real Estate +3.07% Financial +3.02% Communication +1.05% Staples +0.36% Health Care -0.28% Utilities -0.47% *  *  *  * Industry Focus Health Care Equipment Services 6 36 37 Over the past 6 months, the Health Care Equipment subsector (XHE) has underperformed the S&P 500 by -3.33%. Its Power Bar ratio, which measures future potential, is Very Weak, with more Bearish than Bullish stocks. It is currently ranked #14 of 21 subsectors and has moved down 3 slots over the past week. Indicative Stocks DXCM DexCom, Inc. ICUI ICU Medical, Inc. SIBN SI-BONE, Inc. *  *  *  * You have received this e-mail as part of your subscription to PowerFeed. If you no longer want to receive e-mails from PowerFeed, click here. You're receiving this e-mail at diansastroxz.forex@blogger.com. For questions about your account or to speak with customer service, call +1 (877) 697-6783 (U.S.), 9 a.m. - 5 p.m. Eastern time or e-mail info@chaikinanalytics.com. Please note: The law prohibits us from giving personalized investment advice. © 2022 Chaikin Analytics, LLC. All rights reserved. Any reproduction, copying, or redistribution, in whole or in part, is prohibited without written permission from Chaikin Analytics, LLC. 201 King Of Prussia Rd., Suite 650, Radnor, PA 19087. www.chaikinanalytics.com. Any brokers mentioned constitute a partial list of available brokers and is for your information only. Chaikin Analytics, LLC, does not recommend or endorse any brokers, dealers, or investment advisors. Chaikin Analytics forbids its writers from having a financial interest in any security they recommend to our subscribers. All employees of Chaikin Analytics, LLC (and affiliated companies) must wait 24 hours after an investment recommendation is published online – or 72 hours after a direct mail publication is sent – before acting on that recommendation. This work is based on SEC filings, current events, interviews, corporate press releases, and what we've learned as financial journalists. It may contain errors, and you shouldn't make any investment decision based solely on what you read here. It's your money and your responsibility.