Relative strength + intelligence = đź’°

A good less from this week if you missed it

January 31, 2025

Good morning, Folks!

We have been through a lot this week in the markets.  I hope you have navigated things decently so far, this wasn’t an easy one. 

Do you remember the huge tech selloff on Monday due to the DeepSeek bombshell?  (Yes, that was just a few days ago!).

Besides the potential popping of the AI bubble, we had to make it through the first slew of tech earnings reports as well as another Fed announcement.

After all of this, though, things still look pretty bullish to me.  

There are actually a lot of stocks I like right now, as I’ve shared with my members - especially stocks that showed “relative strength” on Monday.

By relative strength, I’m talking about those stocks that didn’t suffer huge losses (or losses at all) in spite of total market carnage happening everywhere else.

That’s how I picked my top Pick of the Week on Tuesday – OKTA.

You can see from this 5 day chart what I mean.

On Monday (the day the NASDAQ got clobbered), OKTA managed to actually pick up a nice gain from the morning’s open.

To me, this fit the definition of relative strength.

So I used relative strength combined with a little intelligence to put out my Top Idea on Tuesday, when others would be shaking in their boots!

Here was my trade plan to Black Label members:

Excerpts from Tuesday’s Black Label Trade Plan

The next few days are very important for the markets. If buyers don’t re-emerge and snap up opportunities at these new low prices, then that would signal to me that the new AI threat from China is real, and AI infrastructure stocks will continue to slide.

The upside is mainly for software stocks.

They don’t have huge capital investments in AI. They only benefit from using those tools.  So, lower cost would be a great thing for them, no matter what country produces the technology.

There is a long list of stocks that fit the bill for this, but today, I am going after a top security software company that has a fantastic-looking chart right now.

My top idea for today is to buy (OKTA) calls.

After releasing that plan, I set to work in the Trading Room with my members.  

You can see the spot where I entered OKTA calls circled towards the bottom.  

And you can see the spot at the top circled where I exited in less than an hour’s time:

Locked in a pretty sweet payday with that early move. 

*Note: Trading is hard, results not guaranteed and should not be expected to be replicated typically.

Anyways there you go - a bit of a key takeaway from me for this week!

How is your trading going? Are you finding yourself improving? What changes have you been making this year? I’d love to know.

And by the way – if you’re not in Black Label, this is the #1 place Jason and I are live trading right now and delivering our best trade ideas!

(P.S. Jason is RIPPING in there today!)

You can join here or give Davis a call and he’ll hook you up with the best deal for access.

See you on the inside,

*As always, I want to point out that I cannot speak for my members’ performance, as results may not be typical and trading is hard. And I cannot guarantee you will make money. But what I can guarantee is that I will work my butt off to teach you WHY I trade WHAT I trade.

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