Weekly Update & Stocks To Short. March 22nd, 2014. InvestWithAlex.com

Weekly Update & Summary: March 22nd, 2014

Overall it was a good week for the market with the Dow Jones up +237 points (+1.48%) and the Nasdaq up +31 points (0.74%) for the week. Structurally, the market did very well, leaving only one big gap behind at around 16,050. I believe the market will go back to close this gap when the bear market initiates.

FUNDAMENTAL & MARKET ANALYSIS:

As per our timing and mathematical work below, the market will continue to shift gears from bull market to bear market throughout 2014. Longer term, this bear market will last between 2014-2017 as I have indicated many times before. While it’s internal structure will not be as violent and as steep as the 2007-2009 bear market leg, investors should anticipate the market to lose 35-40% when it’s all said and done.

(If you would be interested in learning exactly when this bear market will start and its internal structure, please Click Here)

In last week’s update we talked about some of the best ways to approach the bear market and what you should and shouldn’t be doing. To see that report please Click Here. In this week’s update we will take a look at some of the best stocks to short and how you should approach the entire process.

Step #1: Find Highly Speculative and/or Overpriced Stocks.

The list below should get you going. Click on it to see larger image.

Step #2: Find Force Multipliers

In addition to performing technical and fundamental analysis, look for force multipliers. These are the stocks that move at X to market. For example, if the Nasdaq index moves 4%, a stock with 3X force multiplier will move 12%. All you have to do is compare index moves with the individual stock moves during the same period of time. The higher the multiplier, the higher rate of return you should anticipate.

If you believe the market is going decline substantially, it makes a lot of sense to take a short position in such stocks. If the market declines 20%, it is highly probable such stocks will decline 40-60%. Yet, this is not without risk. At times stocks move at X to market due to their fundamental outperformance. In such cases, the declines will be less than overall market. That is why fundamental and technical analysis become so important. You must first figure out if the stock is simply overpriced/overhyped or if there is substance to its outperformance.

Step #3: Take Position

Whatever your trading strategy is, once the bear market starts, execute it. As you know, shorting is inherently riskier and should be treated that way. Keep tight stop losses and execute your risk management strategies to the best of your ability.

That about covers it. If you believe the bear market is just around the corner (as we do), get yourself ready if you are interested in participating on the short side. Identify stocks to short, zero in on force multipliers, execute and minimize risk. Good luck and profit greatly. If you would be interested in learning exactly when this bear market will start and its internal structure, please Click Here.

MACROECONOMIC ANALYSIS:

Ukraine continues to dominate the news.

While the markets were able to ignore the news this week, that might change over the next few weeks and into April. As I have mentioned here before, Putin was willing to walk away with Crimea and call it a day if the West wasn’t hell bent on sanctions. Unfortunately, I don’t believe the West is done, just yet, with either Ukraine or sanctions. If they continue to slap Putin with sanctions he will have no choice but to respond with a military force in Ukraine over the next few weeks.

Let me put it this way. If the West (US or EU) slam Russia or Putin with further sanctions, Putin WILL invade Eastern Ukraine. There will be no fighting and Eastern Ukraine will quickly ask to become a part of Russia. This will create a downward spiral in foreign relations, a massive geopolitical risk and a possible selloff in US equities(see timing & mathematical section).

TECHNICAL ANALYSIS:

Long-Term: The trend is still up. Market action in January-February could be viewed as a simple correction in an ongoing bull market.

Intermediary-Term: Since February 5th, intermediary term picture shifted from negative to positive. Giving us a technical indication that both the intermediary term and the long term trends are up. Yet, that in itself can be misleading as per our timing analysis discussion below.

Short-Term: While the short-term trend remains bullish, it might be misleading as per our timing analysis discussion below.

Again, even though all 3 trends are bullish for the time being, that might be misleading. Please read our Mathematical and Timing Analysis to see what will transpire over the next few weeks.

MATHEMATICAL & TIMING ANALYSIS:

(*** Please Note: This time around about 90% of the information contained within this section has been deliberately removed as it contain too much technical information. Particularly, exact dates and prices of the upcoming turning points. As well as trading forecasts associated with them. I deem such information to be too valuable to be released onto the general public. As such, this information is only available to my premium subscribers. If you are a premium subscriber please Click Here to log in. If you would be interested in becoming a subscriber and gaining access to the most accurate forecasting service available anywhere, a forecasting service that gives you exact turning points in both price and time, please Click Here to learn more.Don’t forget, we have a risk free 14-day trial).

Based on our mathematical and timing work the next turning point is located at

Date: XXXX
Price: XXXX

XXXX

Others are getting very close.

The list below is for your reference point. It entails my investment strategy over the next few weeks for my own investment purposes. While you are free to follow what I do, please do so at your own risk. Do not take this as a trading advice.

Stock	Entry Point ($)	Action To Take
QQQ	88	XXXX
XXXX	1160-1180	XXXX
XXXX	515	XXXX
XXXX	74	XXXX
XXXX	21	XXXX
XXXX	420	XXXX
XXXX	35	XXXX
XXXX	65	XXXX
XXXX	120	XXXX
XXXX	100	XXXX
XXXX	112	XXXX

Otherwise, I suggest the following positioning over the next few days/weeks to minimize risk while positioning yourself for a forecasted market action. (This is continuation of our previous positioning).

If You Are A Trader: XXXX

If No Position: XXXX

If Long: XXXX

If Short: XXXX

CONCLUSION:

An incredibly important week is coming up. Only one scenario remains on the table. I have also described the point force we are looking at and exactly what you should do. Wiith increased volatility, multiple interference patterns and an incredibly important long-term turning point we must be very careful and risk averse here. Those anticipating the moves and those who can time them properly will be rewarded appropriately.

Please Note: XXXX is available to our premium subscribers in our + Subscriber Section. It’s FREE to start.

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