As stocks started getting crushed last week, we quickly shifted to cash and began looking for the next possible market leaders.
Check out our new video here to see exactly what we found.
The main stock market indexes got slaughtered last week, as the S&P 500 swooned 11.6% with five consecutive days of losses. Tech stocks provided no reprieve either, as the NASDAQ Composite similarly tumbled 10.6% for the week.
Continue reading to find out how our swing trades fared during this tumultuous decline, followed by a fresh new video that shows eight strong stocks to put on your radar now.
How We Managed the Market Plunge
The model portfolio of The Wagner Daily was fully loaded with ten open swing trade positions as we entered the trading week of February 24.
Fortunately, the relative outcome was rather positive!
Traditional “buy and hold” investors got slammed that week, but all our positions automatically hit their preset stops–quickly putting us in 95% cash by the morning of Feb. 24 and 100% cash by the following morning.
The constant ability to “stick and move” is one of the best advantages of our rule-based swing trading system, which truly shined by keeping our newsletter subscribers out of trouble last week.
Protecting Profits and Minimizing Losses
By previously trailing stops higher on our winning positions, we still locked in gains last week of +25.6% on $SE, +24.2% on $TDOC, and +10.8% on $ZM (closed Feb. 21).
Our remaining eight open positions stopped out with relatively small losses ranging from -0.6% to just -8.2%.
The S&P 500 is now showing a loss of -8.9% for the year (as of Feb. 28 close), while the model portfolio of our newsletter is still showing a gain of +2% in 2020.
As we frequently remind subscribers, consistent winning in the stock market boils down to simple math, not just necessarily picking the right stocks.
Most importantly, we are now fully 100% in cash and ready to take advantage of the next trading opportunities when the market settles down.
In that regard, we present you with a new YouTube video that highlights eight strong stocks that showed fantastic relative strength by holding firm while everything else around them tumbled.
The first half of the video is an updated technical recap of the major indices, followed by a walk-through of eight stocks that could soon become the next market leaders:
Patiently and Happily Sitting on the Sidelines–Ready to Strike!
Given the stock market’s current volatility, it is still high risk to jump back into new long positions.
Nevertheless, it is wise to start tracking the next potential swing trading opportunities–stocks that showed excellent relative strength while the market tumbled.
When an individual stock has such relative strength that it does not follow the herd lower, it is typically the first stock that will rocket higher when the market eventually bounces.
Relative strength trading of leading stocks is the foundation of the The Wagner Daily swing trading strategy.
Yet, despite the strength of the eight stocks featured in the video, we need a bit of patience to ensure the long-term uptrend in the major indices will remain intact.
If not, then we will remain in cash, happily protecting our hard-earned profits. If further weakness ensues, we will also start short selling stocks with relative weakness.
Always honor your protective stops and remember to trade what you see, not what you think!