Happy New Year!!
This is our first email update of the year, Since December we have hold off option alerts and any short term alert because of high amount of uncertainity and volatilty in the market. We plan to resume option alerts once we see some sort of stability in QQQ.
When 2021 started there was too much greed and optimism in the stock market. Every stock was rallying, people were investing in any kind of assets that goes up double digits in few weeks. And then rest of the year we saw decline of that optimism and exuberance. Greed turned into Fear and Optimism into Pessimism when we began 2022.
But who should not worry? - The long term investor who remain unbiased towards price movement but smartly adds to their current holdings and obviously have to pick right stocks.
The carange in tech stocks provides long term opportunity for investors who remains humble and slowly adds to their positions. Software is eating the world, tech companies are not going away and they will continue to grow.
First iPhone was introduced 15 years ago (just 15 years ago, can you imagine how fast the world has changed since then).. Now just spin your head and image what the world would be in next 5-10 years and which companies are going to transform it. Our tech stocks are going to win and win big.
Long term investor will reap the benefits of it, not the traders..
Set your eyes on 2025 and keep adding(DCA) to your existing stocks for rest of the year. Always remember whenever we add a new stock, we start with minor position and gradually build the full position in several quarters based on broad market sentiment(QQQ)
Take a look at below QQQ chart. Red and Green arrows is when we likely sent an alert or indicated a signal. On green arrows we buy a new stock or add to our current holding to DCA and on red arrows book 20% of profits.
We are not planning to add any new stock or do any DCA at this moment in ourt Portfolio 2022 that holds 7 stocks as of now.
The shaded blue rectangle shows the range of trendline support for QQQ and resitence at top where it recently hit multiple times. The orange horizontal support line indicates a import fib level support.
If QQQ breaks the support trendline and also couldn't hold the support at important fib level then we may see another sell off in QQQ.
But till then we can likely see some consolidation, most of the stocks in QQQ has already been crashed to oversold levels. But what is keeping QQQ's trend are large cap stocks like (Apple, Microsoft, Amazon etc) these companies has benefited from Covid so it's highly unlikely that they will crash like other stocks did. But in market nothing is certain and we have to remain humble, so what we would do is holding on to our best stocks and keep dollar cost averaging them on specific down days.
Meanwhile what we should do is keep our cash at hand.
We are watching following stocks to add in this quarter, if QQQ holds the support.
$ABNB - Disrupted hotel industry and it will keep eating revenues from them for a long long time.
$SNAP - Likely we will buy this stock once it fills the Oct 2020 gap around $30
$NVDA - Semiconductor leader who will continue to win. This company is in the midst of majar trends of EVs, AI, Gaming, Metaverse and Blockchain.