The market took a HUGE dip yesterday.
The S&P 500 ETF Trust (NYSE: SPY) fell 1% and NVIDIA Corporation (NASDAQ: NVDA) fell 7%.
There’s a lot of speculation right now around the events that caused the selloff …
I’ve got all the details. And I have a plan to trade amid this bearish price swing.
First, take a look at the SPY and NVDA charts below, every candle represents one trading day:
This is one of the reasons why I love trading:
I’m not exposed to market swings because I don’t hold long-term positions.
This price dip will slightly affect my trading, but I’m not worried about it. Like a regular investor might be.
In some ways … My trade opportunities are MORE obvious now that the market dipped.
Why Are Stocks Pulling Back?
On Tuesday we learned that President Biden might ramp up tech-export sanctions – specifically for microchip technology.
It could be the latest effort to shield American businesses from Chinese competitors. But it also has the potential to hurt revenue for key U.S. tech companies. The sanctions effectively shrink demand from overseas.
That’s why we saw tech stocks like NVDA and ASML Holding N.V. (NASDAQ: ASML) dive yesterday.
Additionally, comments from former President Trump regarding Taiwan’s safety added to the market instability.
Understand, three out of four stocks follow the market.
When the market is bearish like this, it CAN impact the plays in our sector.
The last few weeks, the stock market was red hot! As a result, we saw a lot of big profit opportunities.
The manic bullish sentiment is most obvious when we see stocks spiking +100%* without any news … Like Locafy Limited (NASDAQ: LCFY), it spiked 380%* on July 11.
There are still profit opportunities when the market dips. We just have to trade more judiciously.
Top Trade Setups Right Now
Now more than ever, it’s important to focus on stocks with real news.
The rocket needs fuel if we’re going to the moon … Do you know what I mean?
Trading no-news runners is a strategy for when the market is hot. Right now we have to dial it back a bit.
Luckily … We’re in the middle of earnings season. As a result, we can expect verified financial data to act as volatile catalysts.
Already, we’ve seen impressive movements from stocks that announced earnings recently.
For example, Yoshitsu Co. Ltd. (NASDAQ: TKLF) spiked 160%* on July 16 after the company announced EPS of $0.20 and a revenue of $195.7M (a 15.3% gain year over year).
Attention: This stock is still consolidating and could surge higher! It found support above the highs from a past spike on May 24.
See the chart below, every candle represents one trading day:
I traded this stock on day one. And I’m still watching it for follow-up moves.
See my trades notes below:
Use this interactive AI bot to follow my trading process and build smart positions.
TKLF isn’t the only stock trading higher with positive earnings right now …
- NiSun Enterprise Development Group Co. Ltd. (NASDAQ: NISN) spiked 90% on July 12.
- Methode Electronics Inc. (NYSE: MEI) spiked 50% between July 11 and 12.
Make sure you’re watching stocks that have a reason to push higher!
That’s one of the best ways to protect our positions in this market.
And if there aren’t any obvious plays, sit on your hands. There’s no need to give away money, lol.
Tune in for one of my live webinars and you’ll see that most of the trading day, I’m waiting for plays.
Take a look at the post on X below from one of my students, this is the right mindset!
Only focus on the best plays right now!
Cheers.
*Past performance does not indicate future results
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