Volatility exploded in the middle of Friday’s session.
I had a bunch of calls running, and all of a sudden the market decided to go haywire. Tech was dropping, so I stopped to put in good-till-canceled orders, which sit in the market until they fill, to make sure I was ready.
With the S&P 500 right about where it was in August, my scanner had 150 stocks trying to climb back from 52-week lows. On Aug. 11, it had 31.
The market is getting out of these stocks for whatever reason, and it has nothing to do with whether the companies are profitable. I think that’s a pretty great opportunity, so I’ve been selling my oil stocks to raise cash for it.
Before I buy any of them, I need to see one thing, and IBM is flashing it right now.
It All Flowed Into A Narrow Area For Tech
Over the last three months, the money all went into a narrow area of tech. This week it started coming out. The Nasdaq is on track for its worst week since April 2025, and the VIX, Wall Street’s fear gauge, jumped to its highest level since June.
It feels like it’s sort of early days here. But this is not a healthy move for stocks, not at all.
So you’ve got a lot of stocks outside of tech, outside of AI, trying to get back to levels they already traded at this year. Home Depot, Lowe’s, Nike and Thor are all on my scanner.
I’ve been selling my oil stocks for the last week, and I’ll keep selling some every day until I’m out. Oil settled above $101 a barrel on Friday. I don’t think oil is a bad business, but when the paint is peeling off the walls for oil, I want to give the stocks away.
It Needs To Stay Above That Price
One thing I need before I buy is the bounce. After a stock hits a 52-week low, I want it to get back 10% above that low and hold there.
IBM’s 10% rebound price is $227.55. On Friday, it was trading around $234, so it’s still above the line.
IBM also doesn’t have the circular financing problems the market is starting to worry about. Those come up when AI companies invest in the same customers that buy from them.
CoreWeave’s rebound price is $73.90, and the stock is way below it. It has to hold up before it gets anywhere near my list.
I sent IBM out to members on Aug. 26 with the stock around $223. It ran to $252, and I got out of that trade because the price looked good. I’m still holding some IBM shares, and now it’s going ding, ding, ding again.
My target is $354, and I want to see the action happen within 90 days. If IBM drops back below $227.55, it’s not an active trade anymore.
Most of those 150 stocks haven’t gotten back to their 10% line yet. What I’m looking for is a huge chunk of the market to change direction, and I want you to be ready when it does.
In the Ceres Club, I walk members through the whole list, along with every factor I use to pick the trades.
Andrew Giovinazzi