THE Winning Formula

Harry’s spent the last 23 years studying cycles (among other things). That’s why I’m fascinated with his work. He’s able to see cyclical turns well in advance of the shorter-term cycles I study.

Of course, we aren’t alone. Analysts have studied cycles for hundreds of years. And a slew of investment tenets and theories are based on the cyclical nature of the markets, even those that don’t include the word “cycle” in their name. Sector rotation is one of them.

The theory behind this idea is that, at any point, some sectors are cycling into favor while others are cycling out of favor.

The reality behind this idea is that, when you use sector rotation in the right way, you gain an incredibly powerful edge that could help you beat the house.

That’s what I do with my trading service, Cycle 9 Alert.

I’ve developed a specific strategy that takes advantage of sector rotation and market cycles. I worked with a group of 54 beta-testers, who helped me hone my strategy. Then we took the service live in May.

To date, readers have had the opportunity to bank gains of 51% in two days, 113% in 42 days, and 140% in 49 days… (to list just a few of our successes).

So how do I do it?

Well, I start by breaking the market down into nine sectors. These are:

1. Consumer Staples (XLP)
2. Health Care (XLV)
3. Utilities (XLU)
4. Technology (XLK)
5. Financials (XLF)
6. Consumer Discretionary (XLY)
7. Industrials (XLI)
8. Materials (XLB)
9. Energy (XLE)

Then, I rank each sector based on a proprietary algorithm I developed. Finally, I search for the strongest stocks within the strongest, market-leading sectors.

It’s worth noting that my expertise is in swing trading, which means I usually hold investments for a couple of months. I’ve found this is the sweet-spot timeframe. It’s long enough for meaningful price moves to develop. And it’s short enough for the stock to not be at the mercy of an earnings report that’s several quarters into the future. Besides, sectors tend to rotate in and out of favor over a two to three month timeframe.

Trading in and out of these shorter cycles allows us to be nimble. We can hop on a hot energy sector for a couple months in the summer, and be out by September. Then, we can invest in the consumer discretionary sector heading into the holiday shopping season, and be out by January.

Bringing the two together, we have a winning formula.

Now THAT’s the power of cycles.

If you want to see what our current model portfolio holdings are, how all my recommendations have performed since last November, and details of the next hot sector I’m fishing in, watch this.

Dow Heading for Historic Drop – Take Immediate Action

World-renowned economist Harry Dent now says, “We’ll see an historic drop to 6,000… and when the dust settles – it’ll plummet to 3,300. Along the way, we’ll see another real estate collapse, gold will sink to $750 an ounce and unemployment will skyrocket… It’s going to get ugly.”

Considering his near-perfect track record of predicting economic events long before they occur, you need to take action to protect yourself now. Get the full details…

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Categories: Markets

About Author

Adam O'Dell has one purpose in mind: to find and bring to subscribers investment opportunities that return the maximum profit with the minimum risk. Adam has worked as a Prop Trader for a spot Forex firm. While there, he learned the fundamentals of trading in the world’s largest market. He excelled at trading the volatile currency markets by seeking out low-risk entry points for trades with high profit potential. An MBA graduate and Affiliate Member of the Market Technicians Association, Adam is a lifelong student of the markets. He is editor of our hugely successful trading service, Cycle 9 Alert.