Samwise Model Portfolios
The portfolios below are separated by launch dates. Each portfolio is entirely independent and has no bearing on any other model portfolio. We launch entirely new portfolios during each market correction as an illustrative tool for new subscribers who weren't present during...
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So… if you haven’t bought yet buy now?
Is the consensus that next week will be lower?
So we generally do our buying on the downside to avoid the risk of buying on what might be just a rebound. Right now, the momentum looks very strong and the rebound is solid. It’s possible the market may have already bottomed. Anytime we get a rebound like this, that possibility always exists. For that reason, we do our buying when markets are oversold so we’re not forced to make those types of decisions.
Buying on an upswing like this, you run the risk that this is just another rebound ahead of another leg lower. So for example, if you buy here at $113, you could be doing so ahead of another push down to the low $100’s.
On the other hand, if the market has already bottomed, we won’t know until how it manages the next lines of resistance. By the time, it could be way too late. If Nvidia pushes north of $120, you’re now taking on a lot of risk buying there.
Hence, why we do the buying when stocks are oversold so we’re not faced with those hard questions.
If we were sitting in 100% cash right now, we’d buy something here to hedge out opportunity risk. But we would also sit on at least half cash so as to capitalize on the next pull-back if/when it happens.
So assuming that this was the bottom this would be considered unusual due to the fact that it happened after a gap up and an initially anemic rebound? Without another leg lower I mean 🙂
thank you!
Yeah that would be unusual. The only other time I’ve seen that happen in recent history was in November 2023. We had something very similar happen. But the momentum kept ramping up.
But if you look at the NASDAQ-100 chart, what you’ll find is that most bottoms happen on extreme volatility like we saw on August 5. That’s the typical case for a bottom.
Does SW intend to buy more LEAP options if the small leg down happens in the next few days or just let it pass ?
Yes. We’re going to get long our remaining positions on the next leg lower.
Thx Sam. I’m learning the SW philosophy /discipline behind the trades and am glad I followed suit on buying NV at $101, QQQ at $448. Had I not followed your blog, I’d be kicking myself not buying any and watching NV climbed to $115 today. I still have 50% capital reserved to buy more.
Hello Sam,
So far on the QQQ we have seen 3 days with sharp drops and both days the sell-off has been bought up and its end up closing slightly positive. Do you still think we will see one more leg on the correction between now and the fed makes an announcement?
I do think we’ll see volatility between now and then yes. That’s our base case even right now with today’s action. The markets are looking very strong right now and there’s always the possibly when we see momentum like this that the bottom is in. But I do think given the magnitude of the fed meeting that we’re likely to see volatility and a last opportunity to buy.
Purchased 80k of September 20th NVDA options on Monday at strike 112 113 and 116. Up massively today! The market has a lot of momentum at the moment. Good chance the market continues to rally until the fed meeting and then traders I think will sell the news. Bull story is looking really solid right now. Any market drops are being bought.
what RSI number were you using to say that NVDA was approaching 70 RSI? I just checked and its sitting at 49 and change currently and price is much higher than when you posted that? Just curious and trying to learn. Thanks.
I’m looking at the hourly chart on Nvidia. Nothing is close to overbought or oversold on the daily. The QQQ got close to oversold on the daily when it reached $448. But it still need a good $10-15 of downside before it really push oversold on the daily.
Do you think NVDA will be testing the 120s tomorrow. I personally think it will hit 120 and then sell off back to the 108-110s and then go on its run to 150 EOY.
That is a very possible outcome across the board. Being as close to $120 as it is coupled with the fact that $120 is the top of the $116-$120 gap line makes it very possible that Nvidia can make that push tomorrow or by Friday.
I’m not too sure it will slide back down to $110. To be honest, if it gets up to $120 and then pulls back to the low $112-$113 area, I’d do the rest of my buying at that point.