Shares rebound as President Trump says to not fear… a brand new instrument to assist us time the tip of this bull… the ability of technical evaluation… Wednesday’s Tremendous AI Buying and selling Occasion with TradeSmith CEO Keith Kaplan
Don’t fear about China, it’s going to all be nice!
That social media publish from President Trump is triggering a giant rebound on Wall Road as I write Monday.
It’s a welcome reduction after Friday’s sell-off, additionally triggered by Trump, when he accused China of “turning into very hostile” and threatened new 100% tariffs.
Wall Road stays hypersensitive to something that might rattle the AI commerce. Certainly, AI stocks are doing the heavy lifting of at this time’s bull market. So, any trace of calm – particularly from Trump – shortly restores confidence within the sector driving most of 2025’s good points.
Talking of AI and good points, AI chip provider Broadcom Inc. (AVGO) introduced a brand new multibillion-dollar deal this morning (as I write, it’s a thriller firm – not OpenAI). It’s up 10%, and one other signal that the AI increase continues to be driving big-money strikes throughout tech.
Additionally from this morning, JPMorgan mentioned it plans to put money into firms deemed “essential” to U.S. nationwide safety, a lot of which sit squarely within the AI provide chain.
Backside line: From chipmakers to information infrastructure to huge banks, the message is obvious: The AI investing juggernaut isn’t slowing down.
Nonetheless, final Friday’s meltdown put one query front-and-center for buyers…
How will I do know when to get out?
Let’s reply it.
To assist, we’ve already launched our “Loopy Map.” It’s an inventory of 5 milestones that always line the trail to a bull market’s eventual peak/bust. We’re monitoring them with a “inexperienced, yellow, pink” scoring system (at this time, three are yellow, two are already pink).
However whereas the Loopy Map is useful for signaling when the broad market is probably going in its closing innings, these innings can final far longer than anticipated. So, we want one other instrument – one thing extra exact even as soon as we conclude we’re within the ninth.
This brings us to senior analyst Brian Hunt… some easy-to-follow technical evaluation… and a information that can assist you sidestep the worst of no matter market collapse is perhaps lurking forward.
At present, let’s dig into precisely easy methods to navigate the tip of this bull market. Relying in your monetary scenario, this problem may prevent thousands and thousands of {dollars} and a great deal of sleepless nights.
Then, after detailing our motion plan, I’ll share with you an AI-based buying and selling instrument that can assist you commerce nonetheless a lot bull market stays forward. It delivered a median annual achieve of 374% in a rigorous five-year examine spanning pandemics, crashes, and international turmoil. It might be one of the worthwhile methods to commerce no matter blow-off high is in our future.
Tons to cowl. Let’s leap in…
Your “sleep in peace” sport plan for navigating the tip of a bull market
For newer Digest readers, Brian used to helm InvestorPlace as CEO, however his old flame has at all times been buying and selling and investing.
So, after selecting handy over the CEO reins, he’s now one in every of our main senior analysts, dissecting the markets and instructing different buyers easy methods to persistently put wads of buying and selling money of their pockets.
Just lately, in an inside InvestorPlace e-mail, Brian detailed how he plans to navigate “the highest.” It’s based mostly on how he sidestepped the worst of the market collapse in 2008/2009, together with an evaluation of how his method carried out when examined in opposition to the 2000 crash.
It entails primary pattern evaluation that Brian writes “may help you keep away from each main inventory crash for the remainder of your life.”
From Brian:
The chart beneath exhibits how the inventory market loved a powerful rally from late 2004 to late 2007.
However then, method earlier than the market meltdown, the S&P started exhibiting horrible value motion habits. These behaviors had been shiny pink warning flags.
Within the chart beneath, you’ll see that in early 2008, the S&P 500 undercut two of its main 2007 lows. This was a 6-month draw back breakout. The bottom low in six months (A). It is a main destructive for any market.
Then, the S&P’s 200 day shifting common turned decrease (B). It is a main destructive for any market. Then, the S&P staged a draw back breakout to new 12-month lows (C).
This bearish transfer was accompanied a transparent sequence of bearish “decrease highs and decrease lows.” It is a main destructive for any market.
Supply: StockCharts.com
Put it all together, and by early 2008 – six months before the worst of the market’s collapse – Brian had spotted clear signs that it was time to get defensive:
To me, this horrid action is not obvious only in hindsight. It was obvious at the time.
And you didn’t need one ounce of mortgage market insight to know the market was sick.
You just needed a basic knowledge of stock trend health that can be learned in a variety of entry level books.
Sure enough, here’s how it played out (notice how much you saved if you’d acted after Brian’s “A, B, C” warning system):
Source: StockCharts.com
The majority of one of the worst bear markets in history could have been avoided by using basic technical analysis.
The same “A, B, C” warnings were evident in the Dot-Com Crash
As you’ll see below, from mid-1998 to mid-2000, the market provided the same warnings:
- A six-month downside breakout (A)
- Buying and selling beneath a declining 200-day shifting common (B)
- A brand new sequence of decrease highs and decrease lows on the best way to a brand new 12-month low (C)
From Brian:
All main negatives by themselves. Mixed, they had been vastly destructive.
That was the time to get out.
Supply: StockCharts.com
After which this occurred:
Supply: StockCharts.com
The place this leaves us at this time
So, first, we have now the Loopy Map signaling after we’re within the neighborhood of a possible crash. Our newest evaluation suggests we’re turning into that neighborhood, however not squarely in it at this time.
Second, we have now Brian’s technical framework that helps us establish, let’s name it, the precise avenue to be cautious about. We’re undoubtedly not there but.
As you’ll be able to see beneath, we’re nowhere near buying and selling at six- or 12-month lows, buying and selling beneath the 200-day MA, or establishing “a brand new sequence of decrease highs and decrease lows.”
Supply: StockCharts.com
Let’s now throw in one final wrinkle to help us with our conviction. We’ll factor in one of the most important yet underutilized indicators in investing.
Volume: the truthteller before price
Price tells us what is happening, but volume tells you how real it is.
Near major market tops or changes in trend, that distinction becomes crucial. After all, how many times have you bought into what you believed was the start of a new market uptrend, only for it to reverse and leave you sitting on sudden losses?
In healthy bull markets, rallies are confirmed by expanding volume – more buyers piling in, more conviction behind each advance.
But as a market begins to tire, that relationship quietly flips…
On “up” days, you’ll start to see shrinking volume. This means fewer investors are willing to chase prices higher. This is followed by sharp “down” days where volume suddenly swells.
That’s often institutions unloading their positions. It’s the “smart money” exiting while retail investors are still celebrating new highs.
This subtle shift in participation is one of the clearest tells of a topping process.
When the heaviest trading sessions start clustering around down days rather than up days, the baton has passed from the “accumulation” phase of a rising market to the “distribution” phase of a market that’s topped out.
Today, we’re seeing some signs that bullish buying volume is slightly softening, but nothing significant enough for us to pronounce a true pivot.
Now, let’s fold this into Brian’s “A, B, C” framework
When we do, volume becomes the force multiplier that validates each technical breakdown:
- When the market posts its first 6-month downside breakout (“A”), check if that drop comes on surging volume, far outpacing volume on recent bullish days. If so, that’s a red flag that the selloff has conviction. And as importantly, if there’s an ensuing rebound rally, how much buying volume is driving it? If it’s light, watch out.
- When price slips below a declining 200-day moving average (“B”), heavy volume confirms the long-term trend has turned. Does the new status quo bring heavier selling volume days than buying days?
- And when a fresh 12-month low arrives (“C”) with a series of lower highs and lower lows, rising volume on down days locks in the verdict: The bulls have lost control.
So, integrating price and volume in this way gives you an early, objective framework to exit with confidence (not panic).
By the time the headlines catch up, you’ll already be on the sidelines, watching the chaos from cash.
But recognize what this means – you won’t get out at “the top”
Here’s the truth that most investors don’t want to hear: This framework won’t get you out at the exact top.
But that’s not a flaw, it’s a feature of disciplined investing. You’ll always “pay” something for prudence – unless you get incredibly lucky and sell at the exact top, which almost never happens.
And even selling at the top would bring a cost. For example, if you sell today – basically at the market’s all-time high – your “cost” is opportunity. You risk watching stocks sturdy themselves from recent wobbles and explode higher, leaving you on the sidelines for the final leg of this bull. Who knows how much higher we’ll go?
On the other hand, if you wait for Brian’s “A, B, C” signals to confirm that the market has truly broken down, your cost is real portfolio drawdown – the decline between the peak and the point where “C” triggers your exit.
In Brian’s examples, depending on exactly where you exit, that could be between 15% and 20% lower.
Either way, there’s a cost. It’s your call as to whether you’d prefer to pay in “potential missed opportunity” or “realized drawdown.” The right answer will be unique to you and your financial situation/goals. Fortunately, you can dial it up or down.
Whatever you choose, recognize the bigger goal: avoiding the worst of a real bear market crash to prevent catastrophic portfolio damage.
So – putting it all together – how will you know when to get out?
Between the Crazy Map’s broad warning signs, Brian’s A, B, C framework, and the confirming story told by volume, you now have a practical roadmap for a specific exit based on a plan – not emotion.
It’s not so much about perfection but, rather, protection. Following this type of framework will help you sidestep the kind of massive losses that can erase years of hard-earned gains and keep your capital intact for the next great buying opportunity.
Speaking of opportunity…
While this roadmap prepares you for the end of the bull, there’s still money to be made while it lasts.
In fact, a powerful new AI-driven trading tool from our corporate affiliate TradeSmith may be the smartest way to capture whatever upside remains – before the final inning ends.
As we profiled in the Digest last week, TradeSmith’s newest innovation, the AI Super Portfolio, is probably the most highly effective quant-based buying and selling breakthrough we’ve ever seen.
Constructed on years of analysis and powered by TradeSmith’s proprietary machine studying engine, this technique layers a next-generation algorithm on high of Predictive Alpha Prime, which is TradeSmith’s most superior AI forecasting system.
The result’s a five-position portfolio that frequently rotates into the shares that the screening AI believes have the best likelihood of outperforming over the approaching months.
In in depth five-year testing, the AI Tremendous Portfolio delivered common annual good points of 374% – that’s by means of the pandemic, fee hikes, commerce wars, and each market twist in between.
To be clear, you don’t have to make use of choices or leverage. There’s nothing loopy right here. Simply the market’s high shares, held for AI-determined durations, rebalanced twice a yr.
To see precisely the way it works, join TradeSmith CEO Keith Kaplan this Wednesday, Oct. 15, at 10 a.m. ET for his Super AI Trading Event.
He’ll stroll you throw how this method takes AI-powered investing to a wholly new degree – and the way you should utilize it to commerce smarter in no matter stays of this bull market.
Have an excellent night,
Jeff Remsburg
