The Market’s New Hidden Trap

Hey, Ross here:

A lot of stocks are looking strong again.

But that strength may be hiding a problem most traders won’t see coming.

Chart of the Day

This chart tracks where investors have been putting their money over the past four weeks.

Riskier assets have pulled in close to $300 billion.

That includes stocks, high-yield bonds and other investments traders buy when they expect more upside.

Meanwhile, demand for safer funds has been far weaker.

So investors are no longer hiding.

They are putting money back to work.

And the shift becomes even clearer when we look inside the stock market.

Since the July 29 low:

Technology has jumped 10.7%.

Consumer Discretionary is up 10.1%.

Communication Services has gained 7%.

Those are offensive sectors.

They tend to do best when investors feel confident and want more growth.

Meanwhile, Utilities, Consumer Staples and Healthcare have all fallen.

Those are the sectors traders usually hide in when they are nervous.

So this is not a cautious move.

Investors have gone straight from defense to offense.

That can create some huge winners.

But here’s the catch:

When money floods into an entire sector, it lifts a lot of stocks together.

The strong ones.

The weak ones.

And plenty that have no business breaking out at all.

For a while, they can all look the same.

They aren’t.

I explain below.

Insight of the Day

A rising tide can make a bad stock look good

When investors pile into a hot sector, they do not study every company first.

They buy funds.

They chase the leaders.

They spread money across the whole group.

And suddenly, stocks with very different businesses start moving together.

One company may have rising sales and better margins.

Another may be losing customers and burning cash.

Yet both stocks can climb while the sector is hot.

That is why I don’t trust a breakout simply because the market has gone risk-on.

I want to know what is happening inside the business.

Is demand actually improving?

Are orders picking up?

Is management seeing something the market has not priced in yet?

That is where corporate insiders can help narrow the field.

A CEO buying shares is not making a broad bet on Technology.

A CFO is not buying because $300 billion moved into risky assets.

They are putting their own money into one company – their company.

They see the orders.

They see the customers.

They see what is happening inside the business right now.

So when a stock is breaking out with its sector…

And the people closest to that company are also buying…

That is a very different setup from a weak stock simply getting dragged higher by the tide.

And in just a few hours at 11 a.m. Eastern today…

I’m going LIVE to show you exactly how I track these legal insider trades…

Including:

• Where to find them before most investors notice…

• The “must-know” traps traders fall into when trying to follow insiders…

• And my three most powerful – yet counterintuitive – insider-buying signals.

The strategy has never had a losing year…

And could have allowed you to sit on open gains like 680%… 285%… and even 1,210% right now.

Money is rushing back into the market.

Now we need to separate the stocks with real fuel…

From the ones simply floating with the tide.

Click here to guarantee your free spot if you haven’t done so yet…

And I’ll see you in just a bit at 11 a.m. ET sharp.

P.S. If you’re planning to attend on a mobile device, make sure you download the presentation app now so you don’t miss anything when it starts. See you there.

iOS: https://apps.apple.com/us/app/goto/id1465614785
Android: https://play.google.com/store/search?q=goto&c=apps

Customer Story of the Day

“Ross Givens & Traders Agency have helped me learn & identify market patterns with analysis as to WHEN and how to properly enter and exit trades, with profit!

It’s been 6 months so far, and the education has been excellent, with the profitable trades following!”

Ross Givens
Editor, Stock Surge Daily