Rockets don’t lift by pushing against air like planes do.
Rockets blast off using momentum.
Momentum is critical to markets.
This is a rocket launch market.
Oversold markets are a launch pad for rockets.
When Stocks Get Oversold It’s A Rocket Launch Market
Our time is best spent looking at our data.
We look at it day after day – it’s like our morning newspaper.
Markets are always different, but patterns do emerge.
This allowed us to act unemotionally last month and scoop-up great stocks… on March 19th, we sent the marines.
We planned ahead – kind of like planning a rocket launch party.
On the same day, we sent a member’s only post, Spotting Opportunity, with names we thought were at good levels.
It’s full of technology names. In the next section you’ll see why.
Was it risky? Maybe.
The key is – it was based on data.
Since being oversold – look how the Big Money Index has blasted higher:
Since being oversold, the returns have been:
SPY +16.20%
QQQ +18.13%
IWM +13.84%
Technology Sector Sees Huge Buying
The best way to find outlier stocks is to follow the big money.
We looked over the last 6 months and grouped all of our Top 20 names by sector.
If we had a MAP 50 list – this would be it!
Below you can see where the big money has been going…if you look closely:
That’s right, 50% of all names seeing big money have been Technology stocks.
There are many “marine” stocks in there. That’s where we spent time looking when we were making our buy lists.
As you can imagine, Software and Semiconductors were part of our list.
The stocks that make up the MAP 50 list can be found here.
Bottom line: if you missed out on grabbing names a month ago – don’t fret.
We’ll see volatility for a bit.
For long-term investors, that’s a good thing.
We don’t see a retest of the March 23rd lows – the data doesn’t support it right now.
That’s been our stance for weeks.
Even if we did retest, it doesn’t matter. We have a game plan, regardless.
While media headlines are terrible and full of pain, try and focus on the positive.
Eventually – things will get better.
I’ll leave you with a thought I had on April 6th – on twitter.
When the world is seeing prosperity, it’s hard to imagine a crisis.
When the world is seeing a crisis, it’s hard to imagine prosperity.
Lucas is co-founder of MAPsignals. His full bio can be found here.
Prior to MAP, he was Head of ETF Sales at Cantor Fitzgerald & SVP of Derivatives at Jefferies, LLC.
