This Is My 'Stay Bullish' Number for Stocks

The market keeps dodging everything thrown at it. You might not trust the latest rally – but one medium-term "bullish" threshold says investors should stay long today... [Stansberry Research Logo] Delivering World-Class Financial Research Since 1999 [DailyWealth] Editor's note: Which signals should you count on in this uncertain market? Marc Chaikin, founder of our corporate affiliate Chaikin Analytics, has an answer. In this piece – adapted from his May 12 Chaikin PowerFeed essay – he walks through what his investment tools are saying right now... and the threshold he says should be guiding your approach to stocks today. --------------------------------------------------------------- This Is My 'Stay Bullish' Number for Stocks By Marc Chaikin, founder, Chaikin Analytics --------------------------------------------------------------- The market just keeps dodging everything thrown at it... Economists and fundamental analysts continue to debate the state of the economy. And strategists are arguing whether we'll endure a hard or soft landing. These so-called market experts' persistent fears of a recession have kept many folks on the sidelines since the October 2022 lows. Meanwhile, job growth is still strong. The unemployment rate is near record lows. Yet the banking crisis has claimed another victim over the past month in First Republic Bank. With this much confusion, I can't blame people for being cautious. More than $5 trillion sits in money-market funds today. Fortunately, we can take a better approach. With the help of our analytical tools, we can jump on the best opportunities. And right now, stocks are in a good spot... So today, let's take a closer look at why I'm optimistic. I'll also share the exact number I want to see the S&P 500 Index stay above. It's my medium-term "bullish" threshold. Let's get into it... --------------------------------------------------------------- Recommended Links: # [Tomorrow's Big Gold Interview]( John Doody's work is read by gold-mining executives and over 40 professional money managers – at hedge funds, mutual funds, private asset managers, and brokers all around the world. And according to John, there has never been a more "perfect storm" for gold in his 50-year career than the one he sees forming right now. That's why he's stepping forward tomorrow for the first time in more than a year to lay out exactly how you can seize this incredibly rare opportunity in gold... the likes of which may NEVER appear again in your lifetime. Before tomorrow, [click here for details](. --------------------------------------------------------------- # [Surprise 2023 Keynote Speaker Announced!]( He's a controversial household name who has been on Oprah, 60 Minutes, the Tonight Show, Saturday Night Live, and countless other shows. Our own Doc Eifrig will interview him live on stage at this year's annual Stansberry Research Conference. [Reserve your ticket today before they sell out (includes $1,000 value gift for free)](. --------------------------------------------------------------- Through four-plus months of this year, the S&P 500 is up roughly 9%. And the Invesco QQQ Trust (QQQ) – which tracks the tech-heavy Nasdaq 100 Index – is up an incredible 27% over that span. As always, though, we want to look at the underlying factors. For that, we use the Power Gauge – one of our most critical tools at Chaikin Analytics. I created the Power Gauge system to bring high-level analysis to individual investors. It combines 20 of the most important factors to an asset's performance and distills them into a simple rating: bullish, bearish, or neutral. Today, the S&P 500 – as tracked by the SPDR S&P 500 Fund (SPY) – maintains its "very bullish" Power Gauge rating. Take a look... To get more specific, the index ranks "very bullish" in its technical strength. And the combined weighted Power Gauge rankings of the stocks in the S&P 500 are bullish as well. Now, has the market's climb been choppy? Absolutely. You can see the volatility on the chart. And it's fair to say that this year's news cycle has felt harrowing at times. But that doesn't negate the broadly improving economic conditions we're seeing. As I told paid subscribers last month... There's a silver lining in the banking crisis, too... The Fed now has the cover it needs to pause – and likely end – its rate hikes. That will likely happen after the expected 25-basis-point increase at the May meeting of the Federal Open Market Committee. Well, the Federal Reserve completed the final part of that statement at the start of this month... It raised the benchmark federal-funds rate by 0.25% (25 basis points). The target range now sits between 5% and 5.25%. The market believes the Fed will soon pause its rate hikes as well... CME Group – which runs the Chicago Mercantile Exchange – maintains a FedWatch Tool to try to predict the central bank's next moves. As I write, it projects a 73% chance that rates will remain unchanged at the Federal Open Market Committee's ("FOMC") next meeting in June. (The FOMC is the Fed's policymaking arm.) Once again, we're seeing the S&P 500's headwinds fade. Inflation is easing, which means the Fed will be able to relax its aggressive posture. Still, a lot of folks have asked me what my "bullish threshold" is... Obviously, I'll be using the Power Gauge as my guiding light. Its nuanced approach means that every stock in the S&P 500 receives an individual rating. The proprietary weighting of those ratings produces the rankings that S&P 500 funds like SPY receive. That said, I can offer you a single number that I'll be watching closely... As long as the S&P 500 stays above its December 2022 low of about 3,760, I'll remain "bullish" on stocks. I also still recommend focusing on stocks in strong industry groups with "bullish" or better Power Gauge ratings – like the now-soaring software-industry group we track, which holds 169 bullish stocks and only two bearish stocks. The market might look confusing right now. But the underlying signals show that the recent rally is strong. That means we want to stay long today. Good investing, Marc Chaikin --------------------------------------------------------------- Editor's note: What was once an easy ride has gotten much harder to navigate... Yet despite it all, Marc's signals called nearly every surprise in U.S. stocks last year. Now, they're warning him of an extreme setup – one that he hasn't seen since well before the 2020 crash. Find out what's coming, how to prepare, and the No. 1 stock Marc is urging folks to buy today... as well as the one stock he says you should avoid at all costs. [Get the details here](. Further Reading One sector is outperforming today. Analysts thought it would never recover from its 2022 losses. But this part of the market is full of opportunity for investors – and two specific companies show that potential... [Read more here](. Mom-and-pop investors have poured cash into money-market funds at a near-record pace. Folks are still fearful. But this huge cash pile shows that when sentiment turns around, we're likely to see a massive stock market rally... [Learn more here](. --------------------------------------------------------------- [Tell us what you think of this content]( [We value our subscribers' feedback. 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