Market Dips and Growth Picks: When to Step In and When to Wait

February 23, 2025 - Update

Last week, the Nasdaq closed at -2.5%.
The S&P 500 finished at -1.6%.

MACRO

• Inflation nowcasting for February 2025 is at 2.82%, showing improvement.

• Oil prices keep trending lower, which should help contain inflation.

• 10-year Treasury yield is trending down, signaling modest inflation concerns.

• GDP nowcasting for Q1 2025 is at 2.9%, indicating robust growth.

• Monetary policy is still somewhat restrictive. M2 money supply is stalling, reflecting the Fed's cautious stance.

• Earnings are growing, though there are signs of a slight slowdown.

• Credit conditions remain healthy, but corporate borrowing is still subdued.

• A ceasefire in Ukraine would be great news if it happens.

• Valuations are high but not at bubble levels.

• Spending cuts under the DOGE initiative could dampen short-term spending. Tax cuts might offset some of that.

Overall, the mid-term outlook seems positive for stocks, unless credit conditions worsen. So far, they remain stable.

INDEX

The Nasdaq has moved sideways since late November 2024.
On the weekly chart, a descending triangle is visible.

Despite a broadly bullish picture, the 10-week SMA is now trending down.
This breaks my rule for new positions. From my first eBook:

1️⃣ Market Risk: Only Invest in an Uptrend

• Condition 1: The S&P 500 and Nasdaq must be above their 200-day moving average.

• Condition 2: The 50-day (or 10-week) moving average must be sloping upward.

Since Condition 2 isn’t met, I’m not buying.
Market corrections are normal, so I’ll wait for a better setup.

PORTFOLIOS

10X MOMENTUM PORTFOLIO

📌 Start Date: April 2023 – Initial Capital: $10K
📌 Focus: High-growth, high-quality stocks
📌 Strategy: Ride bullish trends over weeks/months
📌 Risk Management: Tighter stop losses (~15%)
📌 ROI to Date: +140% (59% annualized)

My buy-stop orders for ACAD and PDD were triggered.
I now have four open positions. Stop-loss levels have been updated.
I’m not buying anything this week.

10X UNDERPRICED GROWTH PORTFOLIO

📌 Start Date: Sept 15, 2024 – Initial Capital: $100K
📌 Focus: High-growth, undervalued companies
📌 Strategy: Up to 10 positions with wide stop losses (25–30%)
📌 ROI to Date: +7% (17% annualized)
📌 Goal: Explosive growth in strong markets

Last week’s moves:

• Stopped out of FOUR for a 9% gain.

• HOOD and LFMD orders were triggered, but I bought them on a dip that went even lower. This was a learning point.

• Updated all stop-loss levels.

UNDERPRICED GROWTH MONTHLY EBOOK SERIES PORTFOLIO

For paid supporters, more details are available beyond the paywall below.

That’s it for this week!
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⚠️ Disclaimer: This content is for educational purposes only. It is not investment advice. Consult a licensed financial advisor before making decisions.