Markets

Is A Bullish Market in the Works?

By Adam O'Dell  |  July 2, 2019

Stocks were down sharply in May. But after rocketing higher in June, that bout of weakness is starting to look more like a blip on the radar than a real concern.

In fact, I made the case to my Cycle 9 readers last week that a bullish market breakout is in the works.

The S&P 500 and Dow Jones Industrial Average are at their all-time highs. Each of the U.S. sector ETFs I track in Cycle 9 are in positive uptrends. And my 10X Profits market-timing model continues to suggest the stock market’s rally is “healthy” and capable of continuing higher, a call it has steadily maintained ever since our last “buy” signal on January 15.

These are all signs of strength. They’re leading me to think that a bullish breakout to new highs could be just around the corner. And since stocks have merely chopped sideways for over a year now, there’s likely a big group of buyers chomping at the bit, not wanting to miss out on the market’s next leg higher.

One way to play a potential bullish market breakout in stocks is to simply “buy the market.” Consider this “feel-good” large-cap ETF I wrote about recently, which is beating its benchmark and still a “buy.”

Another way is to identify market-beating sectors…

How To Identify Winning Stock Sectors

Getting a good read on a stock sector’s momentum is critical to consistently identifying market-beating trades. And that’s what my Leaders & Laggards Board is all about!

Using the algorithm I designed for my Cycle 9 Alert service, the Leaders & Laggards Board ranks each of the U.S. market sectors from #1 (best) to #11 (worst).

Here’s what our Leaders & Laggards Board looks like this week…

Interpreting my Leaders & Laggards Board is simple.

Top-ranked sectors are poised to outperform the broad market over the next two to three months. While bottom-ranked sectors are more likely to underperform. So with only a quick glance, you can easily spot which sectors are “hot” and which are not.

Of course, the Leaders & Laggards Board is a simple graphic. But there’s a lot going on under the hood to arrive at these rankings.

You see, my Cycle 9 Alert algorithm makes two important determinations about each sector:

  1. How much momentum is it showing, relative to the broad market, and
  2. How much momentum is it showing, relative to its own recent past.

The first — a comparison to the broad market — is a classic feature of the momentum strategy.

The second, I believe, is more unique. And it’s particularly important for any trader who’s aiming to capture the highest rate of return from an investment in a short amount of time.

Prepared For The Bullish Market Breakout 

In Cycle 9 Alert, we only allow ourselves two to three months in any one trade, so we’d better get the timing right!

Making sure a potential investment is beating the broad market is a start. But going one step further… and making sure that a potential investment is outpacing its own recent past is an added assurance that we’re positioning ourselves to capture the investment’s meatiest move.

This of course isn’t the only way you can measure momentum. But it’s the approach I’ve used for many years with great success. And it does a particularly remarkable job at identifying stocks and sectors that are poised to “pop” in the very near future.

So if a bullish market is in the process of unfolding, I’m confident

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Adam O'Dell

As Chief Investment Strategist for Dent Research, Adam O’Dell has one purpose in mind: to find and bring to subscribers investment opportunities that return the maximum profit with minimum risk. He achieves this with his perfect blend of technical and fundamental analysis.

Tactically, he does extensive back-testing and probability-based research. It’s the ultimate partner to the exhaustive research that Dent Research co-founders Harry Dent and Rodney Johnson do in the exciting realm of the new science of investing.

Adam is also the executive editor of our hugely successful trading services, Rich Investors Club, Cycle 9 Alert and 10X Profits.

He has worked as a Prop Trader for a spot Forex firm. While there, he learned the fundamentals of trading in the world’s largest market. He excelled at trading the volatile currency markets by seeking out low-risk entry points for trades with high-profit potential.

Aiming to find the best opportunities across all asset classes, Adam expanded into the commodities, equities and futures markets. An MBA graduate and Affiliate Member of the Market Technicians Association, Adam is a lifelong student of the markets. MORE FROM AUTHOR