The Current Market
Dear investors,
Instead of a deep-dive into one company, I am going to be giving brief thoughts on the economy, trade ideas for the current market, and a few long term investment ideas.
Economy
Due to the rise in interest rates, the economy is going to keep slowing down. This will eventually ease inflation, but it will throw the recession into a recession.
I believe that the recession will not be as bad as people think, but it will ultimately still be a recession.
There are two Peter Lynch quotes that really help me navigate a time period like this.
“Every time you have one of these recessions, there are always groups who say it is different this time. We won't get out of this one.”
You have to remember that all the worst recessions were the ones that NOONE saw coming. When the masses are predicting a horrible recession, I take a step back and look at reality not the media.
“If you spend more than 13 minutes analyzing economic and market forecasts, you've wasted 10 minutes. Your job is to find great companies that are undervalued.”
The people who make all the money in the stock market are focused on finding great companies and rare opportunities.
To sum this up, if you put all your time and focus on finding great investments, it will not matter what the Federal Reserve does in 3-5 years.
The Market
The S&P 500 ($SPY) is currently in a massive battle of resistance at $399. If we can hold that line, then we will head to $404 and $412 which will be a pretty nice move for the whole stock market.
The support for the S&P 500 ($SPY) is at $396 and $392.
As you can tell, the bulls and bears are in a big battle right now over this $400 number.
If you are an options trader, I would make sure to keep those numbers in the back of my mind.
Trade/Short Idea
The stock I am studying right now has a WILD short interest of 561%, and it is getting ready to make a run according to their charts. The stock currently sits at $6.47.
This short squeeze candidate is GHSI.
Keep in mind, this stock has been the subject of a lot of bad news recently. If it can somehow get some good news then WATCH OUT. However, it is a very risky play.
The stock currently sits at $6.47.
Investment Ideas
I have been doing research on long term investments that are small-cap stocks. Here are 3