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Sam any thoughts on Palantir as investment? I looked at it when it dropped back into the 60s but still thought it was high and would drop more…..apparently not.
I don’t know enough about Palantir. I think if it got oversold enough, we’d probably buy it just from the strong momentum behind it when it rallies. But that would be for a trade. Up 500% since august is kinda nuts.
We wouldn’t invest in it exclusively for these reasons here:
https://sam-weiss.com/samwise/samwise-strategies/high-pro/
500+ P/E ratio and a $234b market cap is too rich for us. It’s too uncertain to be a long-term investment at a 500+ P/E ratio.
On a large enough sell-off, it could be. But I’d read the link above. That will give you a sense of our perspective and why we have so much invested in the QQQ.
Palantir would have been the BEST investment this past year and it continues to shine. 500% is a lot. The problem is in forecasting that ahead of time.
I can’t wait to see your updated segmented rally table.
I am updating mine here, but with all the non-sense action of december until now, I am not sure of their accounting. I have a number of 3-4 days segmented rallies, each with an equivalent length pull-back: it just doesn’t make any sense.
So the last segmented rally we had was at the end of November when the QQQ rallied from $480’s up to $539.
When the QQQ rallies $50 from low to high, that will consitute the first segment of the new rally and we’ll have started a big rally at that point.
That first pull-back of 3-4% will be a huge buying opportunity because we’ll have a high degree of confidence that we’re going to see at least 2 more segments after that.
So for example, I can totally see the QQQ running from $511 lows yesterday to $562-$563. Pull-back $20.00 down to the low $540’s and then rally up to $580. Stall pull-back and hae a final segment that takes us up to $600+. That’s how the next rally could unfold.
Whether that starts from $511 or some other number or some other time later isn’t yet clear.
But what is likely is a ~50 point first segment. Even +40 would be fine given that this was a smaller correction. So we could see a smaller first segment. But it will be something like that 40-55 points.
I have noted the following segments :
segment from Oct 31 at 483.75 to 515.58 on Nov 11 in 7 days, which is a segment of 31.83 or 6.58%; then down in 4 days to 494.49 or -4.1%segment from Nov 15 at 494.49 to 539.15 on Dec 16 in 21 days which is a segment of 44.66$ or 9.0%; then down in 18 days to 499.70 or -7.32% (down in sawtooth)segment from Jan 13 at 499.70 to 533.82 on Jan 22 in 7 days, which is a segment of 34.12 or +6.8%; then down in 4 days to 510.15 or -4.4%current segment from Jan 27 at 511.05 to now is just 2 days up +2.75%Do you see the same ?
EDIT: P.S. and at the moment I’ve registed the Sept 6 rally’s correction finished on Jan 13 in 18 days and -7.3%.
So here’s the table I have. We only consider rallies that occur in intermediate-term market rallies as segments. What we’ve seen since mid-December has been a lot of oversold rebounds that are small in nature. The largest one went for about $30 which would be a small segmented rally in a regular intermediate-term run. See here.
Thanks Sam. Any insights into why MSFT is staying in the oversold territory for so long this time? Stock seems to be performing worse than the market.
MSFT just reported earning and so it might take a few days for it to form a bottom before jumping in on the rally.
Here. Take a look at this. Compare today to the last time it reported earnings as an example. We’re in for the eventual rebound off of oversold conditions. Chances are that will happen fairly soon. That could start by the end of the week or early next week/.
Hi Sam!
First I want to thank you for following such defined lines when weighing risk and reward in deciding when to buy. It is such a great lesson in patience and consistency. Don’t pull the trigger until the target is truly in the cross hairs.
2nd is a hypothetical question. If you were holding a stock that was up 300% and 25% just on the day, would you consider buying puts to hedge to current gains in the account?
It really depends. There’s a lot of math involved in hedging. You have to use an option calculator — there are plenty online — and then run different scenarios.
I’d read our content on risk management (Chapter 3) to understand the different hedging strategies.
It just really depends on the stock, the options pricing of the stock what the rest of the portfolio looks like. There’s a lot that goes into it.
you have to consider the cost to hedge and off-set that by the gains. We’ve taken a passive approach to hedging here at Sam Weiss. If you read chapter 3 on using puts for hedging, you’ll find there’s an active and passive way to do it. The active way requires a lot of expertise and constant monitoring. It ends up sometimes being cheaper to hedging actively — buying and rolling near-term puts — while passive hedging might cost more but allows you to sit back and do nothing and also generally has a much larger margin of error.
Then there’s covered call selling which helps offset hedging costs when done right.
Please see the 12:25 pm update on Stark/Frey portfolios.
The occasional generated image on your posts add a nice touch ????, like Danaerys on the NYSE trading floor, this one with Jensen Huang riding a bull.
Lol. Thanks. Glad you like them.
Hello Sam, Thanks for this update. I understand that ru is playing on NVIDIA’s decline on the new support of $113. However, historically on the latest publications, NVIDIA tends to increase and make a mini rally before the publication and fall a few weeks after. But normally NVIDIA should have already done this, maybe it’s imminent or maybe there is a change in trend and NVIDIA will increase after the release? When you say Frey’s portfolio is in a similar situation. We own 150 shares of Nvidia stock. This number should rise to 200 stocks and we could very well do it before Nvidia reports its results. If the stock suffers another pullback towards the low $113 area, we will add to our Nvidia portfolio at that time.
Yeah so as Frey is concerned, if Nvidia does pull-back one last time, we’ll probably buy 50 more shares in Nviida. We’d need to see it back down near the $115 level again first.
Sam, with Google and AMD expected to report good earnings after the bell, do you see a pump for Nvidia tomorrow before making a retreat down to the 110-113 target?
Hard to say. It depends on how the market responds. We’re just looking at Nvidia relative to the QQQ and it does look like it wants to make another test of the lows before moving higher. That could be derailed if the market makes a strong move higher on earnings.
Google down to 190$ after earnings, might be worth looking into tomorrow.. AMD too
AMD has larger problems. It could be a good investment. I mean it’s down considerably from its highs and has been on a very long downtrend now.
I don’t like that AMD does’t seem to follow overbought/oversold indicators at all or that it continues to just be in a long-term downtrend. Those types of stocks are very difficult to trade.
As an investment it may pan out given how far it has gone. I’ll tell you this, I am interested in running a financial analysis on the company given how low it has gotten. See if there’s anything there as a longer term investment.
Sam, what do you think about Google? It’s down quite a bit after earnings and approaching oversold
So Google is already oversold. But we’re not interested in it right now. It hasn’t traded very well since reaching the $180-$200 range. It has spent the last few months sort of pushed back by the $200 ceiling.
Also, as the trading portfolios are concerned, I want to sit in cash for the time being until we get a little more clarity on the QQQ.
We need a solid clear-cut opportunity to put on another short-term trade.
With NVDA pushing overbought do we expect another leg down to the 110s?
Nvidia is not quite overbought just yet. It’s still near a 59-RSI. We probably want to see Nvidia get up to $129. That would put a dagger in this whole thing. There’s a good chance we get another leg down and a final sort of opportunity to buy. But we want to see it evolve in a way that sets a bottom. What would help do that is if Nvidia can continue on up to $129.
Id rather buy it with confidence at $117-$119 than at $113 with less confidence that it has bottomed out. So let’s see if it can push overbought first.
Would it make sense to close the NVDA call we have in Baratheon if it reaches overbought around 129$. We’d make a small profit and then probably get in at a better entry point if it goes back down. Only thing is we’d risk missing the upside if NVDA keeps going up even though it’s overbought
Nvm just saw your Nvidia update to just buy another call if it goes down again.
I don’t see the daily briefing for today, I just saw the twitter notifications.
it shows further down the page for some reason the third article down
yeah the update to wordpress is really annoying. They’ve decide to hide the sticky button and I have to use them to organize the posts to keep them above the trades.
we’re probably going to soon change the way we do our trades. Right when we launch the mobile app, we’re not going to post a separate article for each trade anymore. Instead, we’ll keep a single ongoing trade page.
It’ll mean that trades won’t be sent via e-mail anymore. At least not under the current system.
We’d like to exclusively use push notifications via the Sam Weiss mobile app. The
mobile app has a dedicated trades tab which lists every trade we make in order.
Push & text notifications probably work the best overall imo. Also, with time-stamped trades tab, it’s so much more organized and easy to find the most recent trades.