Midterm Sell-Off? Where Sami Would Buy
Was Friday’s sell-off the start of something bigger? Sami Abusaad doesn’t think so. See why in today’s video:
Thursday’s rally into the declining 20-day triggered a sell setup in QQQ, and Friday’s gap down (led by an Intel (INTC) crash) dragged the whole market lower with it. Short term, the market has turned bearish. But Friday’s bounce gives traders a clear line in the sand: if SPY takes out Friday’s low and the 749.50 pivot, the next support sits around 730. And Sami says it would be hard not to be a buyer down there.
Small caps (IWM) should hold Friday’s low, or they’re likely headed back toward 270. Semiconductors (SMH) are the weakest of the group. A break below 511 opens the door to 503–504, and below 500 there’s very little support to stop the slide.
And with the midterms here, Sami points to history. In the last 17 or so midterm years, the S&P 500 has averaged a roughly 14–15 percent gain one year later. He doesn’t trade off past performance, but he doesn’t see the market falling apart either.
So it’s time to be selective.
- Long Candidates: IBM (IBM) stands out after completely negating its breakout failure and holding up against a bearish tape. Clean 1-2-3 setups in Amrize (AMRZ) and Blackstone Mortgage Trust (BXMT), plus a strong-looking Dick’s Sporting Goods (DKS). Enphase Energy (ENPH) may be bottoming the way most stocks do: through a bearish gap down. And EFOR is flashing Sami’s favorite “pinch play” pattern.
- Watch List: Planet Fitness (PLNT) may have bottomed long term, while Rollins (ROL), Fair Isaac (FICO), and UWM Holdings (UWMC) are building bases worth watching.
- Short Setups: Slim pickings. StoneCo (STNE) is the only short that looks good, and even that one comes with a wide stop.
Expect choppy action until the indexes show their hand. Only take setups with the right risk-reward, and keep your stops tight.
Sami already picked four of these names for his newsletter subscribers, with exact entries, stops, and targets. Try 30 days of the Number Ones Newsletter for just $49 and see which ones made the cut.
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