Crisis investing 3/21/2020

Jack Chan
Posted Mar 23, 2020

The word “crisis” in Chinese is danger/opportunity.
Ancient Chinese wisdom has taught us that when there is danger, there is opportunity.
1987.
2000.
2008.
Now.

Current market condition has wreaked havoc in all sectors, stocks, ETFs, currencies, and bonds. And the carnage may not be over as past major corrections in 2000 and again in 2008 were at 50 to 60%, and took more than a few months to complete. Currently, our benchmark SP500 is down 30%.

We cannot predict, but we can prepare, for the next major buying opportunity which has occurred three times every 10 to 15 years within my investing lifetime.

BRK.B – a must own at 50% discount.
A major correction should see prices between $110 to $120.

A major correction will see this Dow ETF at $140 - $150.

SPY – a major correction will see our benchmark ETF at $160 - $170.

QQQ – a major correction will see this tech ETF at $90 - $110.

Summary

We don’t know when the current crisis will be over, and when prices will reach previous major corrections of 50% to 60%. But when they do, be prepared to buy and hold for the long-term.

Personally, I plan to allocate 50% of my capital when these downside price targets are reached: 20% to BRK.B, and 10% each to DIA, SPY, and QQQ.
I will allocate another 50% when VIX turns down on the monthly chart and become fully invested for the next bull market:

Be prepared for a generational buying opportunity.
There will be plenty of fear.
Remember: danger = opportunity

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Mar 21, 2020
Jack Chan
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email: jack@simplyprofits.org
website: www.simplyprofits.org

Disclosure: We do not offer predictions or forecasts for the markets. What you see here is our simple trading model which provides us the signals and set ups to be either long, short, or in cash at any given time. Entry points and stops are provided in real time to subscribers, therefore, this update may not reflect our current positions in the markets. Trade at your own discretion.

We also provide coverage to the major indexes and oil sector.

Jack Chan: Is the editor of simply profits at www.simplyprofits.org, established in 2006. Jack bought his first mining stock, Hoko exploration in 1979, and has been active in the markets for the past 40 years. Technical analysis has helped him filtering out the noise and focusing on the when, and leave the why to the fundamental analysts. His proprietary trading models have enabled him to identify the Nasdaq top in 2000, the new gold bull market in 2001, the stock market top in 2007, and the US dollar bottom in 2011.

In his spare time, Jack is an avid golfer and tennis player, and volunteers his time coaching and lecturing at local clubs and universities.

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