Market Timing Research

Fortune magazine just ran a short article on Home Depot (HD), pointing out that hurricane season is coming. Right about now Home Depot usually makes a pop upwards in price, but we have a problem. And this problem is why we always tell people you must, you absolutely must look at the Factor Seasonals for a stock before you invest or trade because they will show how a stock acts in all sorts of environments.

But first, the best seasonal price forecast or projection chart for HD going forwards from this moment in time:

Right now, the Home Depot price behavior has most closely matched what it does during Bear Markets. Yes, Bear Markets. And with that knowledge, we can look at our Bull-Bear market Factor Seasonal chart of HD and see that the point of recognition is September 13. That’s when the stock possibly plummets. When you have your own seasonal software from our Super Seasonal Cash Flow Traders package, you can create this type of chart to determine this date exactly.

So how do you trade this? I wouldn’t. I simply look for the stocks where I have a much better certainty of outcome because all the factors are aligned. Every month I produce analysis for 100 stocks in each newseltter and ALWAYS find great trades. Home Depot has too much risk for me because I look for much better odds.

Oh, you mean you WANT to trade Home Depot, so you’re asking what to do? Well, come September 13 I might buy puts OR sell calls in a vertical credit spread. That’s me — it’s not a recommendation to you. Right now I might sell puts in a vertical spread as well…that’s me once again, not a recommendation. Buy for a pop? Too risky for me because of time cycles for the Dow Jones (of which Home Depot is a member) peaking the first week of September. It might go up but I just don’t like trades that short in time because it doesn’t give me enough time room for the seasonal to prove out, and with today’s volatility, I want all the factors in my favor. That’s why I go with the newsletter spotted set-ups.

Anyway, that’s how I do it. Doing it sometimes means “I don’t”. That doesn’t mean HD won’t go up or make money, just that the newsletter offers far better setups in my opinion.

Remember, check the Factor Seasonal charts before trading or longer term investing.

This is the current best forecast of the Dow Jones Industrial Average using the best seasonal technology and methods available. Remember this is seasonals, not cycles. Actually the forecast is not very good for the simple reason that the upper right hand corner shows — the figure is less than 70%, so it’s not very accurate or trustworthy for going forwards.

However, some readers wanted to see this projection so here it is, and it matches with the cycles projections from the Foundation for the Study of Cycles which still suggests some type of interim top (perhaps at a lower level) in September, and then a collapse.

There’s been a lot of interest lately in international mutual funds. I’m starting to see quite a few investment advisors and financial newsletter analysts telling their clients to go overseas to help dampen their exposure to US stocks and the US economy that is in the doldrums. Usually they recommend the BRICs and various international ETFs with international exposure. However, I recently came across this list of top international funds, and decided to do some analysis for you.

The following top funds, rated #1 by Zachs, show how they have typically performed when the US was in a recession or the expansion phase of the business cycle.

The five funds include:

Sentinel International Equity A (SWRLX)
Laudus International MarketMasters (SWOIX)
Fidelity International Discovery (FIGRX)
Scout International (UMBWX)
Artio International Equity A (BJBIX)

On August 3 we posted a sample of 4 stock picks — two bullish stocks and 2 bearish stocks — from the August S&P100 and NASDAQ100 newsletters that were just released.

Well yesterday the Dow Jones newsletter was released (we release it in the middle of the month so that you can get some updates for the big Dow stocks without having to wait until the 1st of every month), so I decided to go back in and see what happened to those shares.

Part of the reason was because a subscriber wrote in the following:

I just wanted to give you a quick update on my progress and first experience with the MTR software. As you may recall, I recently signed up with MTR a few weeks ago, but was only recently able to begin using the software last week due to that email glitch which we have fixed. (thanks again for fixing that by the way). Using a combination of the software, the August newsletters, economic conditions, jobs and Fed data etc… I was able to target 2 really great trading opportunities for August. The first was JBHT and the second was RYAAY. I bought puts on both companies on Friday August 6th (5 days ago) and had planned on holding them over the next few weeks. I decided to go ahead and lock in a 78% gain as the old adage “Pigs get slaughtered” still holds true. I have already paid for my first year’s MTR subscription ! I just wanted to say thanks to you and Bill for what you guys are doing. I told Bill over the phone that I believe in MTR, and what you guys are doing. My belief has only been reinforced now, and my confidence strengthened. I been finding not only the software extremely helpful, but the newsletters and ESPECIALLY the Blogs as well. I look forward to the Blogs every day as I have the RSS feed going directly to my gmail account. I find the Blogs especially helpful because Bill really takes the time to explain not only what he looks for, but how he executes his trades. I can also tell by the way he presents his thoughts and ideas, that he is truly convicted and believes wholeheartedly in these concepts. He is genuine and sincere in his videos. The videos, the Blogs, the newsletters, the software…it’s all invaluable ! It’s the “icing on the cake” that I’ve been searching for to enhance my trading techniques. Thank you again, Will and Bill (and anyone else behind the scenes) for your hard work and dedication to MTR. I know it must require a tremendous amount of time, work, dedication and commitment to continuously produce quality results. I will remain a member of MTR as long as it is around.

- Matt McDonnell

Since he was trading the JBHT and RYAAY predictions from our newsletter, let’s analyze those shares to see how they performed. By no means is his case indicative of typical results, results you can expect, nor do we promise you the same type of experience, that you can duplicate such results, or profits using our newsletter or the accuracy of our newsletter. All our SEC, FTC and other disclaimers apply.

However, we have to use this opportunity (since our DJIA newsltter was just released) to analyze all four of these shares to show you once again how to use our newsletter and the many trading techniques that can benefit by it. Usually you have to wait more than a month for results but this is a good time because we’re in the middle of a marekt turn. So watch this video, and then you can go back to our August 3 blog video posting to see what we had predicted because it shows the actual pages from the Factor Seasonal newsletters that predate this.

Sometimes we’re wrong, but we alwasy protect ourselves with MACD or Fisher trigger stops and we’re never afraid to make predictions with our technique. If you are a trader, we believe we offer the most accurate methodology out there to get a future forecast of short and long term stock trends.

I recently read an article about 9 stocks that grew during the recession we’re in. It turns out we can examine 5 of them with our Factor Seasonal program to see what their stock charts look like for business cycle expansions and recessions, as identified by NBIR. Just look at the stock chart and your stock analysis will be done in a few moments.

These 5 stocks are:

F – Ford Motor
WMT – Walmart
AAPL – Apple COmputer
RL – Polo Ralph Lauren
SBUX – Starbucks

After view these charts you can decide for yourself if the stock prices are currently following the Recession or Expansion factor seasonal trend. When a stock isn’t following any pattern closely or what it’s following doesn’t make sense, I stay away. When it seems to be following its typical behavioral pattern from a particular fundamental environment, and that makes sene, then I adjust my investment decisions accordingly.

You decide…

Yahoo Finance recently had an article listing the favorite stocks of multi-millionaires and billionaires. These stocks include Warren Buffett’s Bershire Hathaway (BRK-A), the Fairholme Fund (FAIRX) and the following:

Brookfield Asset Management (NYSE: BAM): Brookfield is a Canadian asset manager that owns and operates real infrastructure and property assets.

Leucadia National (NYSE: LUK): Leucadia is a diversified holding company with interests in telecommunications, manufacturing, oil and gas drilling and gaming.

Loews (NYSE: L): Loews’ owns three publicly traded subsidiaries in insurance, oil and gas drilling and gas pipelines.

Markel (NYSE: MKL): Specialty insurer is similar to Berkshire Hathaway.

I thought it would be interesting to give you the best seasonal stock chart projections at this moment. Sure these are value players that engage in fundamental analysis, but you can use seasonal analysis on top of them to know when to trade. Remember that if the stock doesn’t have a 70% correlation to the forecasting mechanims, then we wouldn’t bother to list it in our newsletter if we were covering it, so you only trade it according to our charts when it’s matching the seasonals with accuracy, meaning it’s trading according to its typical pattern. That’s what we call running after the safe profits (if there is such a thing) — you’re bullish, so you pick a value stock to buy that tends to go up, and you invest in it when its seasonal trend is pointing up too (and the factor seasonal when that cinches it).

And if you’re a value investor or use a value strategy for part of your portfolio read my article on How to combine value investing with seasonal analysis

Even though some of these projection charts aren’t showing our minimum 70% correlation, I’m showing you the best forecast possible just because I wanted to give you something to think about and possibly a way to make money. Every month our newsletters show JUST the stocks following their seasonals with high reliability and predictability so you can trade or invest with them. That’s how we make our money because we believe that our “secret sauce” formula computes the seasonals correctly.

Here are the charts…

People always ask me how to make stock picks or how to trade stocks using seasonal analysis. Well our August newsletters came out over the weekend, I went through the charts and selected several buy and sell candidates, and then got in on Monday for the stocks that I thought had already proven their seasonals.

You don’t always get in on the first day of the month. It was just that some stocks had proven their seasonal lows just prior to the new newsletters. For other stocks the newsletter shows that I should be waiting for trend changes in the middle of this month because they tend to make some V-tops and bottoms. So those go on the watch list and I have plenty of time to evaluate them.

In any case, Pfizer (PFE) was one of the stocks I got in for the retirement account. It’s a short term trade I’m only expecting to hold until September, and if it beats 2% for CDs I’m doing much better than even most portfolio managers, and that’s what seasonal analysis can often do for you in terms of stock picks. In this video you can see the chart, how I selected it, and a SURPRISE … I wake up the next day and PFE had an upside gap due to an earnings announcement well beyond expectations, so the price action in following the seasonals were forewarning of that. Just like our AMZN trading video, these unexpected great moves happen time and again when you start using the seasonal charts for your trading. It might not happen this month, but you get the newsletter month after month and eventually those trades happen for you as you get better at stock selection.

In other words, this video shows you what you get from our newsletters and how to use them to select stocks on both the Buy side and Sell side. Stock pickers love this. Clear signals if you want to buy stocks and sell stocks. Just look for:

I just completed our August newsletters for the S&P100 and Nasdaq100, and thought this would be a good time to show you how to use our newsletters to pick trades. No other service does this for you.

Now see our legal disclaimers to understand we’re not recommending you buy or sell these stocks, nor are we investment advisors, etc. I’m just showing you how each and every month you get 20-30 great trade possibilites, and usually 8-12 (or more during the early Spring and late Fall) stellar setups. So this is not a recommendation to buy or sell shares, nor is it a guarantee of profits or investment success. It’s sort of silly you have to mention this all the time, but it’s the legalities of the world today, and we suggest you read our full TERMS and DISCLAIMERS.

That said … once you have our Factor Seasonal price charts, you can go long, short, buy puts or calls, or whatever your normal investment or trading strategy happens to be after you find a forecast of interest. When the orange projection line and green ordinary seasonal agree, the trend is strong and worthwhile, the correlation with past price action (in the upper right corner) is 70% or higher, and there’s factor seasonal support, those are shares we like. So we don’t interfere with your strategy or try to teach you to be something you aren’t but simply find those setups for you that fit your trading style. These newsletters are perfect for finding you the trading opportunities you want, even if you are a day trader.

I tend to have an equal number of longs and shorts in volatile environments, but then  nearly 100% long or short when the trend becomes crystal clear. How do I pick my trades? I find perfect seasonal set-ups, like this video shows, wait for price action to trigger a MACD, tendline break, or Fisher transform crossover, and then take a position. Simple as that. Some win, some lose (no method is perfect), but at least you are stacking the odds in your favor.

Watch to see how I do this…the stocks being analyzed (we do the analysis for you so you only have to pick the stocks you want to trade) are MO and  CELG on the bullish side and RYAAY and JBHT on the bearish side.