2024-03-07: The Armchair Investor Newsletter. Market Rises Moderately Wednesday.

2024-03-07: The Armchair Investor Newsletter. Market Rises Moderately Wednesday.

The stock market has risen for 16 of the last 18weeks!  But Tuesday’s Distribution day suggests caution now.

Wow! The TQQQ rose 1.8% Thursday, bringing its year-to-date 2024 gains to +18.6% in just over 2 months!  Zippiddy Do Dah!

See how the recent rising market (some in 2023) has grown!

Let’s look more closely at the triple QQQs (all 3 forms of them shown below.) Note the2024 gains are still staying in an orderly 1 – 2 – 3 relationship year-to-date, but the doubles and triples are lagging.

NOTHING NEW IN THE FOLLOWING TEXT. Please just enjoy the 1.5% rise in the single QQQ and the perfectly aligned 4.5% in the TQQQ!

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The following thoughts from yesterday are included in case you missed them, or would like to review them.

I am very pleased with the dependable 1-2-3 relationship the 3 ETFs – the single QQQ, the double QLD and the triple and am especially enjoying making those greatreturns on the triple QQQs!...

The TQQQ has earned 23.9%  in the recent 2 months!

Yes,23.9% is not quite 3 times the 8.8% but it is close and I am NOT complaining!  

NOTE: The longer the year runs, the more the Double QQQ (QLD) and the Triple QQQ(TQQQ) will very from the 2x and 3x numbers. But if you step back, you will probably see the double and triple continue to show moves between the 2x and 3x multiples.

‍Since Covid hit, the market has been a wild (and profitable ) ride. The TQQQ has risen 91.0% (almost doubled!) since it’s low on October 26, 2023 as seen in Wednesday’s chart shown below.

‍My promise to you:  I will identify:

·       When the market is rising and you should BE IN IT!

·       And when the market is falling and you should BE OUT!

But remember --- YOU are the master of your portfolio and, therefore responsible for when to be “in” and when to be “out.”

And always consider…. If you start to get frazzled with the market,… CASH can be a great place to be when an investment shows what I call, “hesitation to rise on higher volume.”

 Yes! And,the TQQQ should always get your ATTENTION FIRST even though the charts look similar. You have to do the math – figure out how much more the triple QQQ (TQQQ)ha rising (or fallen) to decide what to do EACH DAY!

NOTE ……

I USE THE TRIPLE QQQs (the TQQQ) WHEN THE MARKET IS RISING CONSISTENTLY.  THREE TIMES THE GAINS IS ALWAYS BETTER THAN ONE OR TWO!

And when the market is falling the SQQQ will invert the market’s losses into gains.(A 1-to-1 relationship is NOT guaranteed.)

Note: It is always possible for my timing to be wrong. The market can reverse and start dropping the day after I identify a buy signal. It is rare, but it can happen.  If it does, what should you do?  Without waiting for me to tell you, you could go to CASH! Which is always a safe place.

 (And why not just save yourself some time and NOT consider using the TYPICALLY SLOWER MOVING S&P500?)

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If you can’t sleep tonight because you know the TQQQ can drop 3 times as fast as the QQQ, I encourage you to take one of these moves:

·      First, look at a weekly chart (which takes out much of the annoying volatility),  

·       Second, realize that the TQQQ is climbing toward its recent high and is mostly rising (everyi nvestment has ups and downs.

·       Third, stepback and see how they are adding up…. Are the investments rising or falling overall?

·      If you can’t sleep well at night knowing the TQQQ can fall 3 times as fast as the single QQQ, consider holding your investment in the QQQ and “paper trade” the TQQQ until you are comfortable with it.

 ·      And stay tuned…. Note what happens next so you will see if the exit was the best idea….. The good news about the TQQQ is that they have paid me very well in every runup I have used them.

MY PLAN: >>> If the market keeps moving higher consistently,  I will simply put my money in the TRIPLE QQQ until the market starts to generate a smaller return or reverses down.

NOTE: For the last 23 years I’ve been following the QQQs, and then, when the triples came along, the TQQQ (triple QQQ) and the SQQQs (the short triple QQQ), my portfolio has enjoyed an accelerated growth.  

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MY PLAN:  It’s just 3 simple steps:

1.    Be in the TQQQ (triple long QQQ) when the market is rising.

2.    Be in the SQQQ (triple short QQQ) when the market is falling.

.......Remember: The SQQQ rise if you hold it while the TQQQ is falling. The SQQQ is an INVERSE ETF. It rises when the market it represents falls.

3.    And sometimes wait in CASH if the market is changing direction or is just “funky.”  I’ll discuss any of those times in this newsletter!

Isn’tit nice to have an investment that is likely to earn a positive return when the market is falling? (That is what an “inverse” ETF does like the SQQQ.)

>>>And if you ever get spooked, *CASH* is always a safe position.You may not make as much as being in a rising triple ETF but you will sleep better at night if you don’t extend past your comfort level. And a little practice will sure show you what you did right and what you did wrong, If you are willing to examine the big wins and losses.

Could it be any easier?  I have played the triple Note QQQ and inverse QQQ for years; ….even  before I had made much money in them.  They made sense then and they make more sense now!

So I continue my investing plan:

·       Hangon to the TQQQ when the market is rising.

·       Move to CASH when the market is unclear.

·       Change to SQQQ (the short Qs) when the market is falling.

I MUST complement the QQQ and SQQQ ETF managers! They deliver on their promise to ride the TQQQ up about 2.5X to 3X times the QQQ.

 >>> I happily put my investment in the TQQQ as long as the market is rising, having been very pleased with whatever slight variation of 3x that they earn.

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>>>>>>>>MY PLAN FOR THURSDAY:   Be in the TQQQ.  <<<<<<<<<<<<

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REMEMBER: I DO NOT KNOW HOW TO PICK THE TOP OR THE BOTTOM OF A RUN until I see them in the rearview mirror (which may be too late!)

But I usually get closer to the tops and bottoms than most traders.

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>>>NOTE: The nice thing about the TQQQ is -- it can make a lot of money for you when it is rising.  

THE BAD NEWS ABOUT THE TRIPLE QQQs – BOTH the TQQQ and the SQQQ: You can QUICKLY LOOSE THOSE GAINS IN A QUICK MARKET TURNAROUND IF YOU ARE NOT PAYING ATTENTION.  Please visit this newsletter every day – even if only to read the first page.

IF YOU ARE GOING TO PLAY IN THE TRIPLE ETF UNIVERSE, YOU HAVE TO WATCH IT EVERY DAY….. OR BE WILLING TO BE UNPLEASANTLY SURPRISED (DISAPPOINTED) WITH A QUICK SWITCH IN THE MARKET DIRECTION.

>>>> Really…. How long does it take to look atthe current price chart? Just a wink if you have it set up on your phone orcomputer

I AM AMAZED AT HOW FEW DOWN DAYS  the Nasdaq has in the last 20 trading days!

What Ilike best about the current MARKET FACTORS, COUNTS & RATINGS table below is the number of Accumulation days (5) still (slightly) out runs the4 distribution days in the last 20 trading days.

That ratio gives me a good sense of the strength and direction of the current market. If the recent move of 6 UP days and 3 DOWN days confuses you, note that I do not count a day’s move unless it was at least 0.2% up or down (which these did.)

What should you do when the market starts falling (and it always does…. eventually.)?

Just read this newsletter that night and I will give you a simple solution based on what the market is doing then.

If you can’t stand the market dropping, it is OK to sell your holdings abd wait in CASH.

>>>>>REMEMBER: I do NOT know how to:

·      Get in at the bottom or

·      Get out at the top.

·      ButI have consistently gotten closer than most other advisors…. And that timing has returned significant growth in my portfolio and those report from elsewhere.

Are you concerned that the market may have risen as much as it can for the moment? You might be right … but I’m not yet seeing the market slowing down.

>>>The current Uptrend is to still showing moderate strength.  

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NOTE: IF YOU EVER SEE AN EMAIL FROM ME IN THE MIDDLE OF THE DAY (which happens rarely), consider giving it a quick read. It MIGHT include a change of strategy you can implement during the day to reduce your losses as the market falls or to save more of your prior wins.

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·      Remember:The market and individual stocks continue in the direction they are going…until they don’t.

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>>>>Please read this newsletter nightly to be sure you don’t miss my notes on when and where the big growth (or fall) is happening!  

What to do about the high volatility of the TQQQ?

>>>I suggest you read at least the first two pages of this newsletter each night. This action will keep you tapped into the current market. And remember:

·      I do NOT know how to get in at the market bottoms and out at the tops. ----- I just get closer than most others. Note on the above table the price/volume action

of the last 20 days. Only 3 days were Distribution days –when the price dropped and the volume rose, indicated some serious selling.

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>>>>>FINALLY: REMEMBER:

In the stock market,…

“What goes UP, UP, UP….. eventually goes DOWN, DOWN, DOWN! “

Look below at the amazing percentage of stocks that have “A” or “B” ratings – Even after a drop from recent A+B s owning 68%.... today’s 55% As+Bs is still pleasantly strong.!!!

Thursday’s  Accumulation/Distribution table:  

Pink boxes above indicate ratings that have fallen overthe last week.

Green boxes above indicate ratings that have risen over the last week.

Please consider reviewing this newsletter daily: . The markets can change direction and strength quickly! Note that the percentage of As and Bs ROSE over the last 4 weeks – falling from 55% to 52%, rising to 57%, falling to 52% and closing on the highest percent of As + Bs in the last 5 weeks --- 58%!

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NOTE THIS WARNING.  Holding onto a falling stock, (whether an ETF or the stock of a favorite company), is a quick way to lose your recent gains. If you play individual stocks and ETF’s, play carefully. Use the real returns (daily, weekly, monthly)

IT IS COMMON FOR STOCKS, ETFs, AND FUNDS TO FALL FASTER THAN THE RISE.

Of course, I do not sell a position that has been rising well after one or two small down days. But if you had a significant loss over several days, especially if there is an increase in market distribution days (down days on higher volume), then stepping out and waiting in cash can help save your portfolio for future rallies AND let you sleep at night!

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REMEMBER:_____EVEN IF CASH IS A VALID POSITION,…in a fast rising market, you should VISIT your portfolio to verify it (or a big part of it) is not dropping.

>>>> Stay tuned for Friday’s results!

One additional “Word to the Wise”…

>>>>>--- MOST MARKETS FALL FASTER THAN THEY RISE. Beware of buying any new positions unless they are very healthy.

Wishing you big returns in your portfolio!.

I APPRECIATE YOUR CONTRIBUTIONS FOR SUPPORTING THIS NEWSLETTER.  i COULD NOT AFFORD TO TAKE THE 4 HOURS IT TAKES TO WRITE THE ARMCHAIR INVESTOR NEWSLETTER EACH NIGHT AND THEN TRANSLATE IT INTO THE WEBFLOW FORMAT TO BE ABLE TO SEND IT OUT TO YOU!

I USUALLY SPEND  MORE THAN 4 HOURS FOR EACH ARMCHAIRINVESTOR NEWSLETTER:

·      RESEARCHING THE IDEAS IN THIS NEWSLETTER,

·      CALCULATING ALL THE DATA I NEED,

·      WRITING THE TEXT FOR THE NEWSLETTER AND….

·      FORMATTING THE NEWSLETTER.  (Today it was more like 5 hours.)

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I WELCOME YOUR COMMENTS ON THE MINOR CHANGES IN TODAY’SNEWSLETTER (as described in the notes.) 

Thank you for your kind feedback  and ESPECIALLY FOR YOU WHO HAVE DECIDED TO MAKE A MONTHY CONTRIBUTION.

Charlotte Hudgin, The Armchair Investor

May your stock portfolio grow and grow and grow!  

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