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How To Prepare For The Bear Markets

by Investment Mastery 10 months ago in stocks
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Trades Of The Week!

Welcome to the Fabulous Trades of the Week, where we will be taking you in and out of the stocks and cryptos. Using different strategies, we show you the results weekly to follow along and decide whether you want to do the same.

So let’s take you through the first strategy, that is, the Buffalo strategy. Let’s have a look at what’s been happening in the market.

Ticker: CHPT

Currently, we are in several positions. We are taking 3.5% of profits in CHPT. We will see if the market changes today to keep taking the profits or we will continue to take the stop-loss down.

Medifast Inc.

Ticker: MED

Last week, for some reason, the risk-reward and profit or loss moved a bit which shows in the green-red box. On 6th January, we were stopped with a 1% loss out of the profits today. So, that’s not a MOO for us; it’s a BOO. But no emotions here!

Ticker: FISV

We were on a good profit on this, but the market shot back up, and we were stopped out at break-even yesterday. For people who are new to stocks – as soon as we lock in a certain amount of profit as per the strategy, if we are long then we will raise the stop-loss to make sure that we can’t lose any money. This is very important. In this scenario, we fell short which made us lower our stop-loss.

Ticker: BA

Boeing Company

fell like a rock, and we got a 3% profit. So it’s a MOO for us!

Abbott Laboratories

Ticker: ABT

No trade for Abbott Laboratories because it was continuously going down, even though we wanted to go higher. This usually happens when the trade goes below the line, we cancel the trade. This is just our strategy because trading is about no emotions – so we get in with no emotion and we get out with no emotions. Knowing that the system works.

Ticker: NUVA

Today we moved the stop loss to 1% profit. Yesterday we took out on 4% profit and 1 % loss. So that’s a 3% profit in all on NUVA. It’s a MOO for us!

MARKET NEWS

There are some earning announcements in the market by the big tech companies. So we need you to have your longs and shorts ready. We are in some shorts, and we will add some longs and lock in some profits. Federal Reserve has been hinting at the increase in interest rates in March. Generally speaking, that is not good for the market. Since 2009, we have been in the longest bull market in the history of the bull market. It’s really a long term, an unprecedented one. Why? That is because the interest rates have been so low that people putting in money in the market were growing.

As a consequence, the inflation is high, which is, officially 5% and unofficially more than that. So people need to put their money somewhere like the stock market or crypto market. If the interest rates are going to be rising, the dynamics of the market will change. There are factors that will influence the market like Nonfarm Payrolls. So the graph will continue to go up and down.

Last week, we did observe Nasdaq & SP500. So last week, we said that the closure of the weekly candle is quite important. We wanted the price to be above the previous lows, which we could hold on to. Currently, we are still holding the bullish trend. We saw one of these trends rising stronger yesterday. As long as we stay in the trade above the previous level of support, then we are continuing with the bullish trend. So keep an eye on this level, which will determine a correction or something in the long term.

Of course, if you subscribe to our channel, we’ll be keeping an eye on all this as well and therefore doing a lot of the work for you, so go ahead and subscribe now.

New opportunities

The market rallied a bit yesterday. Nasdaq was up around 2.7%. US500 and Dow Jones were equally up. That meant a lot of stocks were rallied quite a bit. Could this be a rebound because it has fallen so much?! We got into this yesterday. Since we rallied so much, we might get a pullback that allows us to get in and then move on to go higher. So we are keeping our eye on it if the market opens up. If the market goes down, we can rally it higher potentially.

POINT TO NOTE: One thing we don’t want you to do is just get in now when it’s so high because it has already taken us in using a stop-order and therefore we’re already in profits. What you don’t want to be doing ever is getting emotional and chasing that stock up going, “Ohhh, I need to get in!” just as it comes down. It either comes down allowing you to get in. Or it doesn’t. You’ve just missed that trade, that’s just the way it is. So… no emotion!

API Group Corporation

Ticker: APG

There is a nice upper trend here. We got in yesterday at this one. It has a great range. So let’s wait for the pullback before getting into this precision. There is a good risk-reward ratio here.

CRYPTOS

Now, the crypto market… Wow, wow, wow, wow, wow! That’s a lot of WOW, but cryptos are very exciting! Of course we have been talking about cryptos every single week. Currently, the market has fallen to 44%. We are in a zone where we have seen support before. Let’s see if that turns into a resistance to carry on lower or get this move higher.

But the question is… are we in a Bear market?

It’s a great question… with different views!

For Dennis, there might be different kinds of bear markets. It’s not only crypto that is falling; it is all kinds of markets that are falling because the Federal Reserve is hypothetically increasing the interest rates, or it’s just the way they say. These announcements are shaking the economies of the world, which are pumped by the US who are printing so much money. It is good news because Bitcoin and Cryptos are legitimate asset class. The cryptos are falling equally during times of uncertainty. It’s not that the crypto market is in bad shape. Facebook is building an entire company around Metaverse, also based on crypto and blockchain. The same scenario is with Microsoft who is buying Activision Blizzard to trade their Metaverse and trade into cryptos or blockchain. So, the adoption in cryptos and blockchain has never been like this before. Considering all these scenarios, we are in a bear market.

For instance, we traded higher low today, breaking below that mark. That’s the first sign of a bear market. We are also trading below the 200 daily moving average, which we crossed in January. So it is a shorter-term bear market, unlike 2017, because the market is gaining a lot of attraction and adoption after the Federal Reserve announcement and slowing of the economy. Moreover, the institutions and retail are earning more money now.

Marcus, it should be noted, doesn’t think we are in a Bear market. It often goes below the 200 daily moving average. As we have seen in June and July, this often comes up in a secular bull market. But, he adds, it could be that we might turn into a bear market for one or two years, like for cryptos. But the good news is, with our strategies and 21 years of experience in cryptos, it doesn’t matter for us. Most of the millionaires were made in a recession or a bear market. So we will be doing the same by using the CCS strategy.

Sandbox

Ticker: SANDUSDT

It has rallied up a bit. Last week we entered at a 64% drop. Sandbox is one of the biggest Metaverses down at a whopping 53%.

Terra Luna

Ticker: LUNA

It is down by a solid 50% after solid upward support.

Solana

Ticker: SOLUSD

It is down by 59%.

Avalanche

Ticker: AVAX

It is down by 53%.

Happening News

1) There is another reason why we think we are in a Bull market still – that is because the Exchange outflows are very high at the moment. That is because many big players accumulating and sending money to the wallets, which means that they are holding and not selling money or panicking. On the contrary, they are accumulating at these prices and sending it to a safe place to keep them there for longer-term. This only proves that we are on a shorter-term in the bear market or a pullback.

2) 2.5 B$ was made in payments using crypto-linked cards in the first quarter of 2022. Mastercard and Paypal were the first ones to do this.

3) Congress members in the US seem to be taking positions in the wider crypto industry. They seem to be warming up to the idea of this asset class. That only means there might be some sort of regulation in the crypto industry if lawmakers enter it. Which we think is a good thing.

4) Will Bitcoin become legal tender in Arizona? This is a hot topic of discussion these days. Wyoming is already crypto-friendly, so it’s all very interesting. It’s a snowball effect where one thing after another is happening.

5) A Crypto Megawhale is one that has over 10,000 Bitcoin. A Megawhale went on an Altcoin buying spree and bought 23.9M worth of Digital Assets recently. This person likes Terra Luna and Sandbox. And remember Marcus bought a piece of land on Sand a while back.

So we’re in lots and lots of positions, we’re not going to add any necessarily until it goes down a little bit more but it looks like it might be going up, but who knows. And we don’t mind. If it goes up we’re in profit, if comes down we buy some more. Always according to rules.

6) According to US Debt Clock, US Government will have to pay 210B$ if they increase the interest rates. They can print more and more. US National Debt is going up a lot faster than the ticker of the US tax revenue. So the amount of money brought in is a lot slower than the US National Debt. Also, UK National Dept is growing at a rate of ₤5,170 per second.

Vale S. A.

Ticker: VALE

We put a stop loss at 10% on Vale. We locked in some profits in case it falls down.

Zoom Video Communication Inc.

Ticker: ZM

We added another entry at -64%. So we are continuously averaging this. Zoom had fallen a lot since it was high on trade in October 2020, when it was down by 74% from the high. Is it a blue-chip company?! They don’t have a dept and have a good quick ratio. They had an incredible year in sales, earnings per shares, income etc. Their earning per share is -10% for the next year, which doesn’t look that good.

New Opportunities

Chipotle Mexican Grill Inc.

Ticker: CMG

They have a good income, positive earnings per share for the next five years, positive return on assets, positive return on equity, good debts – What is there to not like in this company. Honestly, we don’t invest much in restaurants because it is a tough market. You open a restaurant and you are 3 x more likely to go bankrupt. We do like this company because it offers good food. Is that a good reason? Let us know in the comments!

And lastly… here’s our Results. Not bad at all!

Are you following the right strategy to get these results? Do you agree with our strategies, or do you not? Comment below if you agree or disagree.

Follow us to know more about our Stock trading strategies.

If you are a client of Investment Mastery, send us a mail at gabriella [email protected] to become the client of the week. It’ll be an honor to have you featured across our social platforms, where we will share your progress to inspire others to invest and trade. It will make a huge difference in the life of others!

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