April has been a rough month to trade, to say the least.
We had terrible economic data come in during the four trading days we had... The Consumer Price Index rose 8.5% — the hottest inflation reading since 1981 — the Producer Price Index increased 11.2% year over year and 1.4% month over month. And then retail sales jumped just 0.5% versus expectations of 0.6% amid rising inflation.
These reports reinforce the pressure on the Federal Reserve to raise interest rates faster and more aggressively.
But that doesn’t mean there aren’t trading opportunities to be had.
Right now, I’m looking at two stocks to trade over the next 30 days: Dollar Tree Inc. (Nasdaq: DLTR) and Twitter Inc. (NYSE: TWTR).
Even though I’d bet money the S&P 500 isn’t going to be making new highs any time soon — and this is a low-end retailer — I’ve got a hunch Dollar Tree is going places.
And there's a reason for that... When things get more expensive, everyone goes down a level. By that I mean six months ago my kid was eating filet mignon for dinner. Now he’s getting accustomed to eating a bit tougher cut of meat.
When things get too expensive, people will always opt for the cheaper option — think sirloin instead of filet.
And looking at the last time the U.S. had a recession, Dollar Tree rose 86% from December 2007 to December 2009 while the S&P 500 fell 24% and the Nasdaq 10%.
Tuesday’s MAJOR Report and Why THIS Is the Perfect Time to Fade Stocks
April 11, 2022
We’re four months into a choppy and turbulent market that investors expect will get much worse… And I’m concerned for the traders who don’t know how or when to fade the stock market.
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