Hi folks,
I'm sure many of you are familiar with the Art of Trading "Top Pick of the Week" Strategy. I thought this strategy up in mid 2021 and decided to put it into practice in 2022. Since then the strategy has become VERY popular with Art of Trading members!
We've covered the Top Pick of the Week extensively on the Art of Trading blog since its inception. Basically the strategy uses a fixed $10,000 position size each week. A "Top Pick", which is sent to Art of Trading members Sunday evening is then simply bought on the Monday morning open and then simply sold on the Friday afternoon close. The position size stays fixed ($10,000) each week. Very simple and straight forward!
I developed the strategy for those that have professional lives and full time obligations outside of the market and can't always be around screens to trade. It provides a way to be involved in the market with very little effort!
Since I've made this strategy live the Top Pick of the Week returned:
+115.74% in 2022 [Full review]
+131.86% in 2023 [Full review]
A full analysis on the strategy since inception can be found [here]
At the end of each week I update the Top Pick of the Week blog post with the results so its easy to follow along and adds transparency!
Below are the live stats for 2024 (1 week lag)! Be sure to check this post each Sunday evening for a new update for the previous week!
***A small modification to the strategy might be warranted in the case of overbought and oversold levels in the market. Occasionally the market will reach these conditions and it may make sense to hold off on the "Top Pick" when these conditions are met. The chances of the market making a sharp countertrend move during these times is heightened. These conditions are rarely met so it doesn't change the overall strategy in a major way.
2024 Live Stats:
*Based on a $10k position
Percent Gain after Week 18: + 40.50%
Profit / Loss after Week 18: + $4050
Week 1 Top Pick: $BAC
*** NOTE for Week 1:
I sent a quick email to Art of Trading members for Week 1. I opted to wait to see how the market opened the first day of the year (January 2nd) instead of just jumping in. I wanted to see if there were any relative strength leaders to get a better feel for the Top Pick.
Here was the note explaining my thoughts:
"Hey folks,
It was a pleasure working with you all in 2023! Look forward to doing it again in 2024!
As far as this week's STOCKS TO WATCH list & AOT Top Pick strategy, I have the list ready to go but I'm going to wait until after today's close to send it out. I want to get a feel for how the first day of the new year goes.
Thank you and happy trading!"
$BAC: (long setup) forming a tidy bullish flag pattern up here with good relative strength to start the new year. Looking for more potential upside this week.
Target: $38 to $40
$BAC opened strong Tuesday putting financials on the relative strength leaders list. Wednesday $BAC traded slightly below Tuesdays low but was able to reclaim it and close relative strong on the day. Thursday $BAC attempted to breakout above $34, it traded above that spot but faded mid day. Friday $BAC made the breakout and closed strong!
$BAC traded up +2.32% on the week starting Wednesday, giving the Top Pick of the Week portfolio a strong start to 2024!
Week 2 Top Pick: $UPST
$UPST: (long setup) Looking for more potential upside this week since the stock pulled back about 35% in the last few days. It pulled back 6 days in a row. Looks about ready for a bounce going into the week. I'm liking the risk to reward profile here.
Targets: $40 to $42
$UPST started the week quite strong trending steadily higher into Wednesday. Thursday through Friday the stock wasn't able to shake off weakness, closing down -6.47% on the week. The Top Pick of the week takes a systematic approach which thrives on averages. Just a minor bump in the road.
Week 3 Top Pick: $INTC
$INTC: (long setup) forming a tidy pullback here to settle at the 20 day MA (Holy Grail Setup) and several narrow ranged candles. Looking for more potential upside this week.
Targets: $51 to $55
$INTC opened down slightly Tuesday morning, which wasn't necessarily a bad thing giving a strong potential entry to the Top Pick of the Week. Wednesday though Thursday $INTC tried to hold on to opening gains but faded into the close. Friday ended up being the reversal day making a +3.02% move. Closing the week out on a strong +2.49% gain.
Week 4 Top Pick: $COIN
*** NOTE for Week 4:
The original Top Pick of the Week idea was $S for the Monday morning open. Earlier that morning the stock caught an upgrade and gapped up +8% so before the 9:30 AM EST open that morning I sent an email to all AoT members to skip it because of this condition.
Later on that afternoon I sent a new Top Pick of the Week idea $COIN to be bought the following morning, Tuesday. For Week 4 $COIN was the Top Pick of the Week.
$COIN: (long setup) made a nice 37% pullback recently. Made a nice hammer reversal candle on Friday.
Target: $145 to $150
$COIN chopped and churned for the week but offered a low risk entry Tuesday morning. The lower entry allowed the idea to perform on the week, although not as strong as I had anticipated.
$COIN traded up +2.27% on the week starting Tuesday, pushing the Top Pick of the Week portfolio back into positive territory year-to-date!
Week 5 Top Pick: $S
$S: (long setup) Looking for more upside this week since the stock made a smooth and steady pullback to the 20 day MA after last Monday's analyst upgrade.
Targets: $30
$S Made a gap up open Monday morning holding that strength and closing near highs on the day. Tuesday through Wednesday the stocks sold down but made a recovery Thursday through Friday. Overall a choppy week for $S closing down -1.75% on the week. Overall the setup remains technically sound but volatile near the $28 point of resistance.
Stay tuned for more exciting updates and ideas next week!
Week 6 Top Pick: $SOXL
*** NOTE for Week 6:
We booked the gain on $SOXL around 11AM EST Friday. I sent an alert to AoT members stating my intentions to book the profits on the Top Pick. The price at that time was $38.85!
"This AOT TOP PICK trade hit targets for this week. Suggest you close this trade now and no need to wait until Friday's/today's close."
$SOXL: (long setup) An orderly pullback with a strong looking falling wedge setup. SEMI's have been relative strength leaders so I'm looking for a reversal trade higher this week.
Target: $37 to $39
$SOXL opened and closed with strength on Monday then made a move lower Tuesday. Tuesday ended up being the low for the week as $SOXL rallied strongly higher Wednesday all the way into Fridays close.
$SOXL traded up +12.45% from the Monday open into our early exit on Friday, pushing the Top Pick of the Week portfolio to +11.31% YTD!
Week 7 Top Pick: $AMD
$AMD: (long setup) A very constructive consolidation pattern here on the rising 20 day MA. A leading stock from the super strong Semis sector. Volume patterns continues to look very impressive!
Targets: $190 to $200
$AMD opened and traded nearly flat on the Monday. $AMD Opened with a gap down Tuesday but was able to recover by the end of the day and close near Mondays closing price, more or less a "shake-out" day. Wednesday ended up being a strong trend day but Thursday and Friday ended up giving the majority of that move up.
$AMD ended the week higher with a small +0.69% gain. The Top Pick of the Week strategy closed out +12% YTD. A strong start to the year!
Week 8 Top Pick: $IBM
$IBM: (long setup) Looking for more upside this week in the stock as it made a recent smooth post-PEG consolidation pattern. Showed very nice relative strength all week and especially on Friday.
Targets: $200 to $210
$IBM opened flat then faded the majority of the day Tuesday with downside follow through Wednesday. $NVDA earnings reignited the tech sector for the week allowing $IBM to rally sharply off its $178.75 low made on Wednesday. $IBM closed the week at $185.72. Just 1% under Tuesdays opening price.
$IBM ended the week lower with a small -1.02% loss. The Top Pick of the Week strategy closed out +10.98% YTD on the week.
Week 9 Top Pick: $TSM
*** NOTE for Week 9: We opted to skip the Stocks to watchlist for Sunday evening waiting to get a better feel of the market through Monday. The Top Pick of the Week was sent Monday evening. $TSM was taken on Tuesday's open!
$TSM: (long setup) A PEG candle recently and a constructive pullback to test the 20 day MA. Volume patterns continue to look good! 3 mini ranged digestion candles in a row. Look for a big move this week.
Target: $150
$TSM opened flat then faded the majority of the day Tuesday with downside follow through Wednesday. Thursday the stock ticked back up and found excellent follow through strength Friday. Semi's reignited a move this week. $NVDA, $AMD and $SMCI showing continued relative strength.
$TSM ended the week higher with a +2.39% gain. The Top Pick of the Week strategy closed out +13.37% YTD. A new YTD high!
Week 10 Top Pick: $SARK
*** NOTE for Week 10: The Top Pick sent Sunday ($CLSK) evening was skipped Monday morning because it was gapping up 8%. I sent an email to AoT members making note of this.
"The AoT Top Pick for week was $CLSK however the stock is gapping up around 8% in premarket so we are going to CANCEL this Top Pick and hold off until after today's close! I'll send out a new AOT Top Pick after today's close."
$SARK was later sent as the replacement for Tuesdays open.
$SARK: (long setup) This is the Bearish ETF for $ARKK fund. Seeing Distribution Volume patterns piling up as a Double Top pattern is slowly creeping into the charts. Any hints of a pullback for the major indices this week should send $SARK moving sharply higher especially with Fed Chairman Powell making comments this week. Indices might be looking for a reason for a quick pullback.
Target: $28.50 to $30
$SARK opened strong Tuesday morning with volume and strength throughout the day closing out Tuesday near the high of the day. It faded Wednesday through Friday but recovered slightly Friday afternoon into the close.
$SARK ended the week lower with a small -1.71% loss. The Top Pick of the Week strategy closed out +11.66% YTD on the week.
Week 11 Top Pick: $NVDA
*** NOTE for Week 11: We opted to skip the Stocks to watchlist for Sunday evening waiting to get a better feel of the market through Monday. The Top Pick of the Week was sent Monday evening. $NVDA was taken on Tuesday's open!
$NVDA: (long setup) a two pullback in what it is "the Strongest stock" in the market at the moment. Made a big PEG candle recently and this is the first pullback since. A 13% pullback in two days. I highly doubt this stock will pullback much more than the 13% it already made since Friday's highs.
Target: $975 to $1000
$NVDA strong Tuesday and rallied higher for the entire day closing at the high of the day. $NVDA faded Wednesday through Friday. More consolidation may be needed in this spot for now.
$NVDA ended the week slightly lower with a -0.24% loss. The Top Pick of the Week strategy closed out +11.42% YTD.
Week 12 Top Pick: $SOXL
*** NOTE for Week 12:
We booked this Top Pick in 2 parts. One part booked on Thursday at $48.50. I sent an email to Art of Trading members letting them know!
$SOXL: (long setup) a nice smooth pullback in the market's leading sector. Look for a big reversal this week after Friday's "hollow" candle.
Target $50 to $55
$SOXL opened strong Monday but faded into lows on Tuesday. The fail safe for current Art of Trading Top Picks is a maximum 16% drawdown. This threshold wasn't hit and the trade reversed course mid day Tuesday. Strength carried through Wednesday into Thursday. Friday it opened weak but closed strong.
In total the Top Pick strategy realized +6.17% from the Monday open into our two part exit Thursday and the close on Friday, pushing the Top Pick of the Week portfolio to new YTD highs! +17.59% YTD!
Week 13 Top Pick: $AMD
$AMD: (long setup) a very nice pullback recently that crossed below the 50 day MA and reversed back above it multiple times. A 20% pullback in a few short days. Looking for a big bounce next week despite the China news regarding banning AMD chips from Chinese Government computers. Excellent risk to reward entry here.
Targets: $220 to $230
$AMD gapped down on the China news Monday morning which ended up being a blessing in disguise as it provided the Top Pick with a strong entry for the week. After the Red to Green move Monday $AMD traded sideways for the rest of the week.
$AMD ended the week higher with a +4.39% gain. The Top Pick of the Week strategy closed out +21.98% YTD. A new YTD high!
Week 14 Top Pick: $MU
*** NOTE for Week 14:
We booked this Top Pick in 2 parts. One part booked on Monday into strength at $125.85. The second part as per the strategy at Fridays close. I sent an email to Art of Trading members letting them know!
$MU: (long setup) A powerful PEG candle recently and a very constructive post-PEG consolidation pattern with an INSIDE DAY candle on Friday. Volume patterns continue to look good! Strong momentum here, should continue to trek higher as a relative strength leader.
Target $130
$MU opened strong Monday and traded up the majority of the day on strength. Tuesday $MU made an inside day but accelerated higher Wednesday. Thursday and Friday $MU faded from highs.
In total the Top Pick strategy realized +4.64% from the Monday open into our two part exit Monday and the close on Friday, pushing the Top Pick of the Week portfolio to new YTD highs! +26.62% YTD!
Week 15 Top Pick: $MSFT
$MSFT: (long setup) made a PEG candle recently. Looking for more upside/breakout this week after the recent very healthy post-PEG consolidation. INSIDE DAY candle on Friday.
Targets: $475 to $500
$MSFT A choppy up and down week for Microsoft. Much the same as the way the market traded.
$MSFT ended the week slightly lower with a -0.77% loss. The Top Pick of the Week strategy closed out +25.85% YTD.
Week 16 Top Pick: $GLD
*** NOTE for Week 16: We opted to skip the Stocks to watchlist for Sunday evening waiting to get a better feel of the market through Monday. The Top Pick of the Week was sent Monday evening. $GLD was taken on Tuesday's open!
$GLD: (long setup) a mini consolidation pattern shaping up here after hitting NEW ALL TIME HIGHS last week. Looking for more upside this week as this sector gets more momentum during turbulent geo-political environments.
Target: $140 to $250
$GLD made a Red to Green move Tuesday morning. Wednesday through Thursday the ETF chopped around but managed to close strong on the weakest market day of the week on Friday! A huge win given the circumstances of the market this week!
$GLD ended the week higher with a +0.39% gain from Tuesdays opening. The Top Pick of the Week strategy closes out +26.24% YTD.
Week 17 Top Pick: $SOXL
*** NOTE for Week 17:
We booked this Top Pick in 2 parts. We sold half on Wednesday into strength at $37. The second half was sold on Friday morning at $38.50. Art of Trading members were notified on each part as it was sold.
$SOXL: (long setup) Made a big pullback recently in SMH(and SOXL). Looking for more upside this week after today's INSIDE DAY candle.
Target $38 to $40
$SOXL opened strong Tuesday and continued that strength into Wednesday. We sold some strength Wednesday to position for volatility through Thursday with $MSFT, $GOOGL and $INTC earnings releases. $SOXL traded strong and closed on highs Thursday. Positive earnings reports from $MSFT and $GOOGL helped propel the market higher Friday giving us our second exit earlier Friday morning at $38.50. Our average exit price was $37.75. Locking in an incredible week for the Top Pick strategy! This was the biggest trade for the Top Pick strategy YTD!
In total the Top Pick strategy realized +15.02% from the Tuesday open into our two part exit Wednesday and Friday intraday, pushing the Top Pick of the Week portfolio to new YTD highs! +41.26% YTD!
Week 18 Top Pick: $CRWD
$CRWD: (long setup) made a very healthy pullback recently (A leading name in the cyber security sector). Looking for more upside this week after testing the 100 day MA.
Targets: $340 to $360
$CRWD A choppy up and down week for CRWD. Following the flow of the market. The setup remains strong into next week though.
$CRWD ended the week slightly lower with a -0.76% loss. The Top Pick of the Week strategy closed out +40.50% YTD.
Stay tuned for more exciting updates and ideas next week!