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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Thank you! Can I ask: why would you wait for the QQQ to rise another 15$ or even more to then pull back another 10-15$ or even less before allocating the rest of the allotted capital?
I mean would it not make sense to buy at least some with the rest of the 50% of the funds?
Or do you think the risk of it pulling back to 460ish is greater than that, so you‘d rather not invest it now?
So there’s a few reasons for that. The forecasting confidence that the QQQ will rise to $485 or $490 from here without first pulling back is still not high enough for me to confidently step in and buy just as the QQQ is reaching overbought territory. What’s more, what we get with a rally up to $485-$490 is confidence that the correction is over with a pretty high degree of certainty. We haven’t seen that happen yet and so we can’t say with such a high level of confidence that the correction is over.
That’s why buying on a pullback from $485 down to $470 gives us a lot more confidence than buying at $470 on a rally from $448.
The piece that’s missing is the actual rally up to $485. Even now at $472-$473, there’s still a high risk for one more pull-back to retest the current correction lows of $448.
So the way to think about this right now is like this. If the QQQ peaks here and pulls-back $10-$15 going into the fed pivot, we buy in the low $460’s. If the QQQ continues on its merry way up to its prior high of $485 (whereI think it’s most likely to run into resistance), then we simply buy on the $15-$17 pull-back down to $470. At $485, the QQQ will have gone through that typical overbought > consolidation > lag > 2-4% pull-back cycle. In that case, we buy at $472-$473 or even $475 (from $490 peak). The 2-3 point we might miss out on is worth the visibility. WE want to see what’s happening next before deciding.
Finally, another reason for us to wait — being 50% long already — is that there’s always the possibility of the sell-off being something greater than expected. We are going into a major fed interest rate decision and the QQQ has already rallied $25 going into the event. If we get a larger selloff, it gives us that opportunity to buy on the cheap again.
I’m not afraid of the market running without me becuase we’re already up 25 off the lows. At this point, we’ll be able to buy at these levels anyway.
Thank you for your detailed reply! Makes sense to me:)
Didn’t you say that the market will typically drop before the rate cut next week? Is that likely out the door now? Thanks for your time and help.
So yeah our expectation was this. Going into Monday, we were deeply oversold on Nvidia and the QQQ. The QQQ doesn’t get oversold all too often. And with Apple introducing the iPhone 16 and with the CPI report out on Wednesday, our expectation was for a rebound going into the CPI report.
After that we were expecting one more sharp pull-back between the CPI report released yesterday and the fed decision on interest rates next Wednesday.
Our base case is for a sharp pullback before the Fed next Wednesday.
What has changed is the size and scope of the rebound this week. It went substantially further than I expected. I was expecting Nvidia to maybe peak out near the $110-$112 area (that’s a 10-12% gain) and the QQQ I believe we had peaking at $459-$462 with a breach of $466 constituting a likely end to the correction (due to the 50% retracement). We certainly didn’t expect a rebound up to $473 though we outlined it as a possible risk. Anytime the QQQ pushes into oversold territory, there’s always the possibility of a full-blown bottom.
What’s more, with the correction having gone 7.7%, it was already in-line with a full 1/3 of all past corrections going back to 2010. Finally, with the QQQ having already had a substantial 16% correction between July and August 5, this correction was likely to be on the smaller side of 5-9% (in-line with 1/3 of all corrections).
So right now our base case is for the QQQ to peak sometime in the next day or so with some volatility happening next week ahead of the fed. If that doesn’t happen and the QQQ continues higher, we’ll still have an opportunity down the line because as I posted above, the QQQ will come into heavy selling resistance at $485/$490 with a likely pull-back of $15-$17 like we saw multiple times over the past year. I think we’ve had something like 6-7 of those 2-4% pullbacks in 2024 alone. They typically happen after a 25-45 run. Right now, the QQQ is at a full 25-point run off the lows.
Thus, what we have right now is either we buy around $460 between now and next week or we buy at these current levels about a week after the fed pivot. There will be an opportunity to buy at $472-$473 if the market breaks out right now is the point.
Thanks… does the same go for NVDA? Will it likely follow the QQQ and pull back a bit?
What target price do you forecast that GOOGL can reach (within 6-8 months)?
So I’m not sure about 6-8 months. We’d be buying it on a 2-year time horizon. Analyst consensus estimates for Google put it at a value of $201 on average. That consensus is often right and the analysts have done the work for me. So when making purchases based on the technical outlook, I tend to rely on analyst estimates and price targets.
I think with Google we’d probably look to buy Dec 2026 $120 calls or something like that. I’d have to take a close look at the option situation. But with a move up to $200, that’s a near 30% return.
seeing nvda just closed the gap from 116 – 120 what are your thoughts on nvda testing the 120 -125 gap. I feel like the stock is shooting backup too quick so im unsure of when this might happen.
Well if the market continues pushing higher, then there’s no reason why NVDA can’t easily fill that gap. In fact, once the QQQ fully bottoms, we’ll be rallying for a good long while. Once this entire corrective period ends, we go into another bull market leg higher and that can last anywhere from 70-100 sessions and 25-30% in upside.