Why I’m Buying the Dip on Tech

Note: As a special treat, I had today’s images created courtesy of our robot overlords. Enjoy!

July is National Ice Cream Month.

It’s also National Hot Dog Month and National Picnic Month.

And that makes perfect sense.

It’s hot, Americans are outside flipping burgers on the grill and roasting hotdogs over campfires…

Parks are filled with picnickers and families hosting everything from birthday parties to reunions…

And there are few moments more enjoyable than eating a sweet treat as an escape from the heat…

We all know, there’s no better burger than one consumed on a paper plate while sitting at a picnic table surrounded by family and friends, reminiscing, and laughing about both the good and bad times.

Of course, July is also home to Independence Day in the U.S. – the father of all cookout celebrations.

But these are only a handful of reasons why I love this month… particularly when it comes to money.

You see, as a trend investor and strategist, July is arguably the perfect month of the year.

Hello Friend!

The mantra throughout my investing career has been: “The trend is your friend.”

And I’m always on the lookout for the friendliest of trends, to identify those tipping point moments for profits.

Well, July, particularly for tech stocks (and Bitcoin), is one of those.

Now, I know equities are off to a slow start this month. There’s some skittishness started to percolate.

The Invesco QQQ ETF (QQQ) – the proxy for the Nasdaq 100 – is off its 52-week high set in June of $372.85. And at the moment, following last week’s better-than-expect ADP employment numbers, as well as Friday’s softer-than-expected U.S. nonfarm payrolls, “the Qs” are down 1.37% in July.

But here’s why I don’t think investors should fret… at least not yet.

The fact of the matter is, the last time the QQQ ended July with a loss, George W. Bush was president…

That’s fifteen consecutive years of gains! (And three presidents ago.)

There is no other month on the calendar sporting such consistency… not even close.

I mean, really ponder that for a moment… especially considering all that’s spewing from the financial media and the constant warnings of a recession.

The reality is, the QQQ gained in July during a global financial crisis… It gained during a downgrade of U.S. debt… It moved higher despite a European debt crisis, multiple trade wars with China, a global pandemic, and the Federal Reserve hiking rates at the fast pace in decades.

None of that mattered... at least not in July.

That’s the caveat.

Because we know that the Nasdaq collapsed into bear markets during the financial crisis, the pandemic and in 2022.

The QQQ also suffered sizable losses in June, August, and September in many of the past 15 years.

But July… July has been a sweet treat. A shelter from the storms.

Now, there’s tons of red meat to feed the bears coming down the chute. We have the start of second quarter earnings season underway… We’ll hear June Consumer Price Index and Producer Price Index numbers this week… And at the end of the month, we have the next rate decision from the Fed.

But as we build up to each of these, keep in mind July is not only a month for summer fun… It’s also home to one of the friendliest trends for tech.

So, look to take advantage of dips when you can on tech, knowing that the QQQ has ended this month higher for 15 years straight.

Knows knowing is half the battle,

Matthew

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© 2023 Matthew Carr

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This market commentary is opinion and for entertainment purposes only. The views and insights shared by the author are based on his many years of experience covering the markets. But they are subject to change without notice and opinions may become outdated. And there is no obligation by the author to update any information if these opinions become outdated. The information provided is obtained from sources believed to be reliable. But the author cannot guarantee its accuracy. Nothing in this email should be considered personalized investment advice. Investments should be made after consulting your financial advisor and after reviewing the financial statements of the company or companies in question.