On March 30, Wealth Research Group invited me on its video show to talk about the successes of my “unbeatable” stock-picking system in timing market tops and bottoms.
Remember, just a week earlier, the Dow had hit rock bottom at 18,591.93 – down 37% from its all-time high on February 12.
Not only was it the market’s worst performance since the Great Depression… it was the fastest crash in history.
During the interview, the host asked where my system saw the market heading next. More or less, I said, “Strap on your helmets. We’re going higher!”
Coincidentally, the video was posted on April Fools’ Day. And boy, the backlash was fast and furious…
Here’s just a sampling of some of the criticism I received:
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“The bottom is not in!! You guys are crazy. Be prepared for Dow 10,000.”
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“Agreed [that the Dow is headed lower]… but lower than, 10,000. Maybe 6,000. What a load of crap!”
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“Hopefully, this is an April Fools’ joke.”
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“This is a theft video. Disgusting.”
Now, I don’t even know what kind of “theft” the last comment was referring to. But trust me, there were many more comments like that – including some that I can’t even publish in this newsletter.
(However, I did have one supporter… who said, “Listen to Jason. But buy bitcoin.” While I’m glad he agreed with me on stocks, I’m not a bitcoin guy. I know a lot of you are, though. So maybe you can school me.)
But let me ask you this: Would you rather be popular and wrong… or unpopular and right?
The Numbers Don’t Lie
Here’s why I showed you all those critical comments above…
Since the March 23 trough, the broad market has rallied over 43%. So while the bears were predicting a collapse and the end of the world as we know it, my Palm Beach Trader subscribers were quietly making money.
In fact, since the March lows, we’ve added four stocks to our portfolio. They’re up an average of 15%.
And during the depths of despair, we picked up life sciences software firm Veeva Systems (VEEV). It’s up over 67% in under three months.
[Note: VEEV is currently above our buy-up-to price, so we don’t recommend initiating a position now.]
So how did I get it so right while the bears got it so wrong?
Well, I go by the data – not by emotion. And as you know, I developed my own “unbeatable” stock-picking system.
I’ve used my experience from nearly two decades at prestigious Wall Street firms – regularly trading more than $1 billion worth of stock for major clients – to make sure it’s highly accurate, comprehensive, and effective.
My system scans nearly 5,500 stocks every day, using algorithms to rank each one for strength. It also looks for the buying and selling movements of big-money investors in the broad market.
Remember, its data is so accurate, it was only one trading day off in predicting the March 23 bottom. My system’s market timing indicator – the Big-Money Index (BMI) – called for the trough to be on March 20.
It also forecasted eight other market moves during this pandemic-related sell-off… including this huge market rebound.
And on March 30, the BMI bottomed at 9%:
It was one of the lowest index readings I’d ever seen. And it signaled the market was headed for a powerful rebound.
That’s why I said, “Strap on your helmets. We’re going higher!” And sure enough, we did.
But it gets even better than that…
It’s Better to Be Right Than Popular
For the past month, we’ve been in overbought territory (a BMI reading over 80%, as marked by the red line in the chart)…
Generally, this means a pullback is near. But I’ve been telling you for weeks that we can stay overbought for a long time.
In fact, over the last 30 years, my data shows overbought periods like this last an average of a month, but as long as over three months.
Now, we’re about a month into these overbought conditions. Yet the data is showing this rally is likely to continue a bit longer. (At writing, the Dow is up about 3.5% for the day.)
As I told you Wednesday, big-money buying in exchange-traded funds continues unabated. In fact, Wednesday’s buying volume was the most my system has ever recorded.
The good thing about these extreme conditions, though, is that you can rack up huge gains. So you don’t want to get off this train too early.
Of course, these extreme conditions won’t last forever. My system indicates a pullback is likely. We just don’t know the exact date yet. It could come next week or next month.
So here’s what we’ll do…
Ride your winners until the market crests. When the data reverses, we’ll sell some of them and lock in profits. And once we get the green light to buy again, we’ll redeploy our cash on the next set of winners at bargain prices.
Before I close, I just want to say this…
I haven’t mentioned anything about the coronavirus pandemic… the nationwide protests… the coming presidential election… or any of the negative headlines in the news.
When it comes to the markets, all of that is just noise.
If you want to make money as an investor, it’s better to be right than popular. And all that matters is the numbers.
They’re not always popular. But they’re almost always right.
Patience and process!
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Jason Bodner
Editor, Palm Beach Insider
P.S. Again, my system’s data can truly take the emotions out of investing and lead you to profits – no matter which direction the market’s headed in next…
It can help you target the best stocks out there, so you can add them to your shopping list for the coming pullback. That’s why I’ve put together this special presentation to show you all the details of how my system works.
It’ll help you find the next big winner primed to soar higher, even during the current market volatility. So be sure to check it out right here.