A Bull’s Survival Guide for September’s Bear Market

by | Aug 26, 2022 | Market Outlook, Options

Markets are set to close the week on a nasty down note after Chair Jerome Powell delivered his keynote speech at the Federal Reserve retreat in Jackson Hole, Wyoming.

Markets opened flat only to see a sharp move down after Powell flapped his big maw, saying the Fed’s fight against inflation is likely to “bring some pain to households and businesses.” 

Ouch…

Tech and growth names are leading the way down, with the Nasdaq and S&P 500 both dropping more than 2.5%.

And with the specter of more interest rate hikes looming over Wall Street, we get ready to head into what is historically the worst month for the S&P 500… September.

Traders who don’t want to fully embrace the bearish mindset will need to be selectively bullish with their strategies…

And that’s exactly what I plan to do!

Legends of the Fall

More often than not, markets see a loss in September going all the way back to the ’40s.

Things usually slow down in September and October — summer travel is over after Labor Day, the kids are already back in school and holiday shopping won’t kick off until November.

And maybe more important, institutions start looking to wind down underperforming positions heading into Q4.

For the past two years, September has been a bloodbath for Wall Street, with the S&P 500 dropping over 4% heading into the final quarter…

And though 2018 and 2019 saw gains in September, the selling was only deferred to the start of October.

Add in the Sept. 20 Federal Open Market Committee meeting, and all of these factors have historically proven to be the perfect cocktail for sell-offs — and the main reason I’m not looking to get married to anything long term right now…

Take the Money and Run

The way I see it, when this market offers traders gains of 20% or more, you take that money and run…

In fact, the New Money Crew strategies keep racking up the gains with this selectively bullish, short-term strategy.

On Monday, Weekly Blitz Alerts took fast profits on Nikola Corp. (Nasdaq: NKLA) puts, collecting a 45%* gain in 40 minutes…

We followed that up with another blistering trade on Energy Transfer LP (NYSE: ET), pulling in 47%* in 20 minutes!

That selective strategy has helped Blitz completely crush the lifetime weighted average return of 14.46% — including all winners and losers — and the average hold time of eight days in the past few weeks…

It’s also big reason why my Wiretap Alerts strategy has gone 9 for 9** so far in August, including a 62%** winner on ChargePoint Holdings Inc. (NYSE: CHPT), a 50%** gain on Enovix Corp. (Nasdaq: ENVX), and even two 40%-plus** gainers shorting AES Corp. (NYSE: AES) and Harley-Davidson Inc. (NYSE: HOG)!

We issue three new trades around 2:30 p.m. EDT at the end of each week, and usually exit within the first 30 minutes the following Monday…

Meaning we get three days’ worth of catalysts with just a few hours of trading exposure in the live markets.

As a trader, I like to get in, take what I can and get out.

That doesn’t mean I don’t have some regrets about selling too early, but I’ll take crying all the way to the bank any day over a loss.

The Benefits of a Selectively Bullish Strategy

With markets slowing down into what has been a historically tough month, the only broad category of stocks I’m bullish on is energy.

That’s right, it’s finally time for the boring energy names to take the lead again… In fact, the Energy Select Sector SPDR Fund (NYSE Arca: XLE) jumped as much as 29% since July 14.

Will we have sky-high energy prices two years from now? No one knows… And as I mentioned, I’m a trader and my time frame is a lot shorter.

If the choppy market conditions we’ve seen the past week continue through September, Energy is a sector that can continue to trend upward in its own little world, regardless of what happens in the overall market.

It’s the only block on Wall Street where I’m comfortable owning longer-term calls right here.

And for a near-term one-two punch, I’d look to round out those energy longs with shorts in areas directly impacted by rising fuel costs…

Right now, travel stocks are ripe for short plays, especially with the small run up in cruise names like Royal Caribbean Cruises Ltd. (NYSE: RCL), Carnival Corp. (NYSE: CCL) and Norwegian Cruise Holdings Ltd. (NYSE: NCLH).

Check out the video and let’s talk about how I’m gearing up for September with this selective bullish strategy. Don’t forget to follow me @LanceIppolito on Twitter, Instagram and our YouTube channel for more trading insights and tips. And as always, you can find me right here talking stocks and options trading — and printing money — on WealthPress.com!

P.S. I have to imagine that most traders don’t know what it’s like to win nine trades in a row. 

I mean, most folks are thrilled with three in a row — But NINE**, that’s almost unheard of…

To say it’s been easy would be a lie…

But here we are — nine** amazing wins while most folks are getting their clocks cleaned. And all of them have come in the month of August! 

And now I’m ready to reveal the secret behind these nine straight winners…

It has nothing to do with breakouts, penny stocks, technical indicators or momentum…

But rather a particular time of the week… 

See My Secret

* Stated results are atypical for given period. Past performance is not indicative of any future results. Trade at your own risk.

** Stated results are atypical for given period. Past performance is not indicative of any future results. Trade at your own risk. From Sept. 24, 2021, through Aug. 24, 2022, the average win rate was 69.7%. The average return on options was 14.5% over a three-day average hold time.

WRITTEN BY<br>Lance Ippolito

WRITTEN BY
Lance Ippolito

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