2024-02-27T: The Armchair Investor Newsletter, Market has a quiet day

2024-02-27T: The Armchair Investor Newsletter, Market has a quiet day

My Tuesday Action Plan: Hold the TQQQ.

The Nasdaq picked up a little steam on Tuesday ….. but very little.

‍Tuesday was another quiet day in the stock market.  Note the three major indexes did not movesignificantly. The Nasdaq did rise 0.4% but its volume was almostunchanged.  The S&P500 rose justenough to earn another accumulation days (rising price and rising volume). Butthe Dow Jones Industrial Average (DJIA) lost enough (-0.2%) to earn a minordistribution day.

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I am very pleased with the dependable 1-2-3 relationship the 3 QQQ ETFs.  I am sure making great returns on those triples!...18.2% in less than 3 months this year!

The QQQ family usually rises and falls with the general market.

But remember!:  The above“multiples” also fall at 1x, 2x and 3X times as fast when the QQQ drops.  Look at a TQQQ chart around 10/26/23 last year. Wow! Did YOU take part in that rise?

Since Covid hit, the market has been a wild (and profitable) ride.

(The above chart includes Tuesday’s action.)

My promise to you:

I will identify:

·      When themarket is rising and youshould be in it.

·      And when themarket is falling and you should be out.  

Also, please remember: ….. I do NOT know how to:

·      Get in at thebottoms or out at the tops.

·      We can onlysee the tops and bottoms after they have happened!

·      But I do havea good track record of getting in and out near the points of inflection.

And always consider…. If you start to get frazzled with themarket,… CASH can be a great place to be when an investment shows what I call,“hesitation to rise on higher volume.”

Yes! And, the TQQQ should always get your ATTENTIONFIRST even though the charts look similar. You have to do the math – figureout how much more the triple QQQa (TQQQ) if rising (or falling) to decide whatto do EACH DAY!

AND TO REMIND YOU……

I USE THE TRIPLEQQQs WHEN THE MARKET IS RISING.  THREETIMES THE GAINS IS ALWAYS BETTER THAN ONE.

And when the market is falling the SQQQ will invert themarket’s losses into gains. (A 1-to-1 relationship is NOT guaranteed.

Note: It is always possible for my timing to be wrong. The market can reverse and start dropping the day after Iidentify a buy signal. It is rare, but it can happen.  If it does, what should you do?  Without waiting for me to tell you, you couldgo to CASH! Which is always a safe place.

(And why not just save yourself some time and NOT considerusing the TYPICALLY SLOWER MOVING S&P500.)

REMEMBER:  Everyrising market has some down periods.  You have to decide how much of a sell-off you canstand.  I hope you will find the ideasin this % newsletter helpful in making your directional decisions.

You certainly can SELL if you are uncomfortable with THEINTRADAY ACTION of any stock you own. But I am hanging on the Tripple QQQ until I see it show some greatweakness. I will watch what happens daily. If the market drops during the day,you may get a mid-day message posted on the newsletter site (when I get themessage application working again.)

Yes, the QQQ did drop on 5 of the last 7 trading days. But note that since Thursday, the Nasdaq has sat in positive territory compared to Wednesday's close last week.

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If you can’t sleep tonight because you know the TQQQ can drop 3 times as fast as the QQQ, I encourage you to take one of these moves:

·      First, look at a weekly chart (which takes out much of the annoying volatility),  

·      Second, realize that the TQQQ is climbing toward its recent highand is mostly rising (every investment has ups and downs.

·      Third, step back and see how they are adding up…. Are the investments rising or falling overall?

·      If you can’t sleep well at night knowingthe TQQQ can fall 3 times as fast as the single QQQ, consider holding yourinvestment in the QQQ and “paper trade” the TQQQ.

·      And stay tuned…. Note what happensnext so you will see if the exit was the best idea….. The good news about theTQQQ is that they have paid me well in every runup I have used them.

MY PLAN: >>>If the market is moving higher consistently, I simply put my money in the TRIPLE QQQ until the market starts togenerate a smaller return or reverses down..

NOTE for the last 23 years I’ve been following the QQQs, andthen, when they came along, the TQQQ (triple QQQ) and the SQQQs (the shorttriple QQQ), my portfolio has enjoyed an accelerated growth.

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

MY PLAN:  It’s just 3simple steps:

1.     Be in the TQQQ (triple long QQQ) when the market is rising.

2.    Be in the SQQQ (triple shortQQQ) when the market is falling hard.

o   The SQQQ rise if you hold it because the SQQQ is an INVERSEETF. It rises when the market it represents falls.

3.     And sometimes wait in CASH if the market is changingdirection or is just “flakey.”  I’lldiscuss any of those times in this newsletter!

Isn’t it nice to have an investment that is likely to earna positive return when the market is falling? (That is what an “inverse” ETFdoes like the SQQQ.)

>>> And if you ever get spooked, *CASH* is always a safe position. You may not make asmuch as being in a rising triple ETF but you will sleep better at night if youdon’t extend past your comfort level. And a little practice will sure show youwhat you did right and what you did wrong, If you are willing to examine thebig wins and losses.  

Could it be any easier? I have played the triple Note QQQ and inverse QQQ for years; ….even  before I had made much money in them.  They made sense then and they make more sensenow.

So I continue my investing plan:

·      Hang on tothe TQQQ when the market is rising.

·      Move to CASH when the market is unclear.

·      Change to SQQQ (the short Qs) when the market is falling.

I MUST complement the QQQ and SQQQ ETF managers!  They deliver on their promise to ride theTQQQ up about 2.5X to 3X times the QQQ. In a

>>> I happily put myinvestment in the TQQQ as long as the market is rising, being very pleased withwhatever slight variation of 3x that they earn.

>>>>>>>>MY PLAN FOR TUESDAY:   Be in the TQQQ.  <<<<<<<<<<<<

REMEMBER: I DO NOT KNOW HOW TO PICK THE TOP OR THE BOTTOM OF A RUN until I seethem in the rearview mirror.

But I usually get closer to the tops and bottoms than most traders.

>>> NOTE: The nice thing about the TQQQ is -- itcan make a lot of money for you when it is rising.  

THE BAD NEWS ABOUT THE TRIPLE QQQs – BOTH the TQQQ and theSQQQ: You  can QUICKLYLOOSE THOSE GAINS IN A QUICK MARKET TURNAROUND IF YOU ARE NOT PAYING ATTENTION.  Please visit this newsletter every day – evenif only to read the first page.

IF YOU ARE GOING TO PLAY IN THE TRIPLE ETF UNIVERSE, YOUHAVE TO WATCH IT EVERY DAY ….. OR BE WILLING TO BE UNPLEASANTLY SURPRISED(DISAPPOINTED) WITH A QUICK SWITCH IN THE MARKET DIRECTION.

>>>> Really…. How long does it take to look at the current pricechart? Just a wink if you have it set up on your phone or computer

I AM AMAZED AT HOW FEW DOWN DAYS the Nasdaq has in the last 20 trading days!

What I like best about the current MARKET FACTORS,COUNTS & RATINGS table below is the number of Accumulation days (5)still (slightly) out runs the 4 distribution days in the last 20 tradingdays.

That ratio gives me a good sense of the strength anddirection of the current market. If the recent move of 6 UP days and 3 DOWNdays confuses you, note that I do not count a day’s move unless it was at least0.2% up or down (which these did.)

What should you do when the market starts falling (and it always does…. eventually.)?

Just read this newsletter that night and I will give you asimple solution based on what the market is doing then.

If you can’t stand the market dropping, it is OK to sellyour holdings abd wait in CASH.

>>>>>REMEMBER:  I do NOT know how to:

·      Getin at the bottom or

·      Getout at the top.

·      But I have consistently gotten closer than most other advisors…. And that timing has returned significant growth in my portfolio and those report from elsewhere.

Are you concerned that the market may have risen as much asit can for the moment? You might be right … but I’m not yet seeing themarket slowing down.

>>> The current Uptrend is to still showingmoderate strength.  

NOTE:  IF YOU EVER SEE AN EMAIL FROM ME IN THEMIDDLE OF THE DAY (which happens rarely), consider giving it a quick read. It MIGHT include a change of strategy you can implement during the day to reduce your losses as the market falls or to save more of your prior wins.

·      Remember: The marketand individual stocks continue in the direction they are going… until theydon’t.

>>>> Please read this newsletter nightly to besure you don’t miss my notes on when and where the big growth (or fall) ishappening!  

What to do about the high volatility of the TQQQ?

>>>I suggest you read at least the first two pagesof this newsletter each night.  This action will keep you tapped into thecurrent market. And remember:

·      I do NOT know how toget in at the market bottoms and out at the tops. ----- I just get closer thanmost others. Note on the above table the price/volume action

of the last 20 days. Only 3 days were Distribution days–when the price dropped and the volume rose, indicated some serious selling.

>>>>>FINALLY: REMEMBER:

In the stock market,…

“What goes UP, UP, UP….. eventually goes DOWN, DOWN, DOWN!“

Look below at the amazing percentage of stocks that have“A” or “B” ratings – Even after a drop from recent A+B s owning 68%.... today’s55% As+Bs is still pleasantly strong.!!!

Tuesday’s Accumulation/Distribution table:          

Pink boxes above indicate ratings that have fallen over the last week.

Green boxes above indicate ratingsthat have risen over the last week.

Please consider reviewing this newsletter daily: .The markets can change direction and strength quickly! Notethat the percentage of As and Bs took hit over the last 4 weeks – a dropfrom 61% four weeks ago to 52% 2 WEEKS AGO TO 58%LAST WEEK on this week! >>>>>  A small drop !

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NOTE THIS WARNING.  Holding onto a falling stock, (whether an ETFor the stock of a favorite company), is a quick way to lose your recent gains.If you play individual stocks and ETF’s, play carefully. Use the real returns(daily, weekly, monthly)

IT IS COMMON FOR STOCKS, ETFs, AND FUNDS TO FALL FASTER THAN THE RISE.

Of course, I do not sell a positionthat has been rising well after one or two small down days. But if you had asignificant loss over several days, especially if there is an increase inmarket distribution days (down days on higher volume), then stepping outand waiting in cash can help you save your portfolio for future rallies and letyou sleep at night.

REMEMBER:_____EVEN IF CASH IS A VALID POSITION,…in a fast rising market, you should VISIT your portfolio to verify it(or a big part of it) is not dropping.

Stay tuned! And watch daily!

One additional “Word to the Wise”…

>>>>>--- MOSTMARKETS FALL FASTER THAN THEY RISE. Beware of buying any new positions unlessthey are very healthy.

Wishing you big returns in yourportfolio!.

I APPRECIATE YOUR CONTRIBUTIONS FOR SUPPORTING THIS NEWSLETTER.  

I USUALLY SPEND  MORE THAN 4HOURS FOR EACH ARMCHAIR INVESTOR NEWSLETTER:

·      RESEARCHINGTHE IDEAS IN THIS NEWSLETTER,

·      CALCULATINGALL THE DATA I NEED,

·      WRITINGTHE TEXT FOR THE NEWSLETTER AND….

·      FORMATTINGTHE NEWSLETTER.  (Today it was more like 5 hours.)

I WELCOME YOUR COMMENTS ON THE MINOR CHANGES IN TODAY’S NEWSLETTER (as described in the notes.) 

Thank you for your kind feedback  and ESPECIALLY FOR YOU WHO HAVE DECIDED TO MAKE A MONTHY CONTRIBUTION.

Charlotte Hudgin, The ArmchairInvestor

May your stock portfolio grow and growand grow!  

CharlotteDH100@mail.com

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