Hey, Ross here:
Let’s start the day by looking at a chart that shows why a brief market pullback could be imminent…
And why this is actually a (time-sensitive) opportunity for savvy traders.
Chart of the Day
This is the percentage of stocks trading above their 50-day moving average – an indicator of their medium-term direction…
And earlier this week on Monday, this percentage peaked at 75%…
The same level as it was in late July – right before the big market decline.
Now, I don’t believe we’re going to see the same pullback like we did from August to October – not at all.
But as you can see, the percentage of stocks above their 50-day moving average is pulling back slightly.
In the Insight of the Day, I explain a couple factors that could be contributing to this – and why this is actually an opportunity.
Insight of the Day
Institutional investors often practice tax-loss harvesting – setting the stage for a December rally.
Tax-loss harvesting is the practice of selling losing stocks before the end of the year in order to reduce taxable gains.
It’s standard procedure among the big institutional investors…
And it usually results in stock prices briefly pulling back during December – before rallying again toward the end of the month (the so-called Santa Claus rally).
Combine this practice with the fact that many major indexes have already become overextended…
And you have a recipe for a brief, healthy pullback that sets the stage for a much bigger rally.
To turn this into an opportunity, however, we have to position ourselves now.
That’s why I’’m going LIVE tomorrow morning for my weekly session for my Traders War Room members…
Where I’ll be showing them how to hunt for the highest-potential “pullback stocks” – the ones that could surge the most in the subsequent rally – in REAL TIME.
If you want to join tomorrow’s session, it’s still not too late.
Just click here to get all the details on how to be part of my War Room now…
And I’ll even throw in the details of my #1 AI stock completely free.
I hope to see you tomorrow.
Embrace the surge,
Ross Givens
Editor, Stock Surge Daily
