That interview was well-timed. Jason told me he was bullish going out to the end of the year. And since that discussion, the Nasdaq 100 Index has climbed almost 10%.
Recently, Jason wrote to subscribers of his free e-letter Power Trends about the biggest opportunities he's seeing in the tech-stock surge. I found it so valuable, I knew I had share it with you today …
These Leading Sectors Could Be the Best Buys for 2024
By Jason Bodner, Editor, Power Trends
I'm not one for proclamations — guess I shouldn't run for mayor — but I think it's safe to proclaim that stocks have turned.
It's also clear based on my data and qualitative analysis that we should have a nice rally ahead of us to achieve some juicy profits.
I mean, just look at the surge in the Nasdaq. Tech has led the charge, and the tech-heavy index is already back to within 2.5% of its July highs.
It took nearly three months for the index to lose 12%. And it's taken three weeks to gain 12%.
Unfortunately, many of those who sold on the way down probably haven't gotten back into stocks — or at least not as fully invested as they were before.
Regular Power Trends readers know that I was exceedingly confident that a rally was coming. What I couldn't pinpoint — and nobody can — was exactly when it would start and how quickly it would unfold.
That's why, if you invest in the highest-quality stocks to begin with, it's almost always better to stay the course. When elite stocks get hit with everything else, they usually then bounce the furthest and the fastest.
But you need to be in them to profit from the bounce.
That said, this strength should last a while, so it's not too late to start making money …
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By any measure, the recent rally is about as impressive as it gets.
Sticking with the Nasdaq, we see that 13 of 15 trading days since the Oct. 26 bottom have been up. That's a lot of green bars – and an 86.7% winning percentage.
What's more, we also see that gap up on Tuesday (Nov. 14) after the latest inflation data was better than expected. A big move like that after the Nasdaq had already moved higher 10 of 12 previous days shows that investors are itching to buy.
This is confirmed by the data in my Quantum Edge system, where I track Big Money activity.
You can see on the chart below that Tuesday's big up day generated the most Big Money buy signals (green bars) since July, when the market was strong. And below that, you can see how the number of buy signals has trended higher since the October bottom, while the number of sell signals (red bars) has dried up dramatically.
A lot of stocks have been on fire. Roku (ROKU), the streaming device company, soared 43% in the past month. Netflix (NFLX) is up there, too, with a 35% pop.
In my two Quantum Edge services, 14 of 26 stocks in the two portfolios have rallied more than 10% just in November. Eight of those have surged more than 15%.
I hope you've enjoyed similar bounces in your stocks. But if not, here are some hot sectors to consider…
This may be the biggest tech opportunity you'll see in your lifetime. (HINT: It's not Google, Microsoft, Nvidia, or other obvious companies that have already run up).
Our biggest gainer is a semiconductor company that has shot up 33% since the Oct. 26 bottom. That's instructive.
Technology led the last rally. And so far, technology is leading this rally — after a few bumps and bruises in between. You should expect that to continue.
First of all, it just makes sense. We live in a tech-driven world. And secondly — those of you who know me well won't be surprised to read this — the data supports it.
My research firm, MAPsignals, did an awesome study looking into the top-performing sectors after our proprietary Big Money Index (BMI) climbs out of oversold, which it officially did on Nov 6. Technology is the leader by far, averaging 27% gains in the year that follows.
What else do you notice in that table? Every single sector was up 12 months after the BMI was oversold.
Here again, that pattern is confirmed by current data. Tech is indeed leading us out of the depths. Since Nov. 1, more than 30% of all Big Money buy signals in my Quantum Edge system have been in technology — nearly twice as much as the next leading sector, Financials, with 17%.
Source: MAPsignals.com
Not surprisingly, this new buying catapulted Technology back to the top of my system's sector rankings.
I wouldn't be surprised to see stocks take a breather and even pull back a little bit after this latest run, but that would only lay the foundation for the next big move that I think could last through the end of the year and into the first quarter — possibly even longer than that.
You still have time to make money. And if you're wondering where to start, high-quality tech stocks are the place to look. And our data shows that discretionary, industrial, and financial stocks may be solid bets, too.
Just make sure they have the Quantum Edge trifecta of superior fundamentals, strong technicals, and Big Money flowing in…
Then enjoy the ride.
Talk soon,
Jason Bodner Editor, Jason Bodner's Power Trends
P.S. Any investor looking to make the most of the rally I see coming would benefit from joining me in Quantum Edge Trader.
My Quantum Edge system is fine-tuned to spot the best small- and mid-cap stock opportunities in the market… and also to take profits on them at opportune times.
No fuss, no muss — just buying and holding great quality stocks in strong uptrends that the biggest institutions on Wall Street are rushing into.
Not long ago, I released a research presentation about what I see as an "A.I. Reckoning" coming to the investment world. In it, I shared my plan to take advantage of the biggest A.I. opportunities and avoid the pitfalls that most investors don't see coming. Click here to check it out.
Michael's Note: Heads up…
Today's the last day you can get Predictive Alpha at an all-time-low price: just $19 for your first year.
The offer ends today, so make sure you review the details here before we reach the end of Cyber Monday.
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TradeSmith is not registered as an investment adviser and operates under the publishers' exemption of the Investment Advisers Act of 1940. The investments and strategies discussed in TradeSmith's content do not constitute personalized investment advice. Any trading or investment decisions you take are in reliance on your own analysis and judgment and not in reliance on TradeSmith. There are risks inherent in investing and past investment performance is not indicative of future results.
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