Despite the Volatility, I'm Still 'Bullish' on Stocks

Editor's note: A major wave of volatility has swept the market... But according to Marc Chaikin – founder of our corporate affiliate Chaikin Analytics – one key indicator points to more gains in 2025. In this piece, updated from a recent issue of the Stansberry Digest Masters Series, Marc reveals the key support level he's paying attention to... and why he expects a big opportunity in 2025.

Without question, we've endured a challenging stretch in the market recently...

The S&P 500 Index suffered a 10% pullback in less than a month. And the tech-heavy Nasdaq 100 Index lost 13% over the same period.

Beyond that, a major wave of volatility is sweeping across the top of the market...

In the Power Gauge, none of the so-called "Magnificent Seven" stocks earn a "bullish" or better overall rating today. And the group's collective performance has been terrible over the past month. On average, these stocks are down 7%.

This has shaken investor confidence. I'm sure you – or folks in your personal circle – are feeling the negativity in the market today.

And that leaves us with a pressing question... What's next?

Today, I'll explain a key support level I had been watching. And I'll discuss where history tells us the market is heading next...

Put simply, the broad market is struggling. And the Power Gauge makes that clear...

That's the tool we use at Chaikin Analytics for analyzing the market. It gathers investment fundamentals and technicals into a simple rating of "bullish," "neutral," or "bearish."

And based on the SPDR S&P 500 Fund (SPY), the S&P 500 is in "neutral" territory in our system. Right now, SPY holds 132 "bearish" or worse stocks compared with just 56 "bullish" or better ones.

Meanwhile, when looking at SPY on the chart last month, I had my eye on the movement between two key levels...

As you can see, I've marked two lines on the chart. The first – the red dashed line at $580 – traces SPY's low earlier this year from January 10.

On February 10, I told paid Chaikin Analytics subscribers in an edition of Market Insights that "if we break 5,990 [in the S&P 500] on a closing basis, I expect knock-on selling pressure perhaps down to the 5,800 level."

Since then, the S&P 500 did move below that 5,990 level. And unfortunately, SPY has also retraced below $580.

I also noted last month that the S&P 500 breaking down below the January lows at 5,800 would mean the possibility of a full-blown correction of 10% to the 5,500 level. And that's what we ended up seeing.

Now, before that decline, corporate earnings pushed the market to new highs last month... but just barely.

Revenue for tech titan Nvidia's (NVDA) 2025 fiscal year came in at more than $130 billion. That's a 114% gain over the previous fiscal year. And it tells us that there is real wind behind the sails of the artificial-intelligence trend... which has been driving this bull market.

Unfortunately, the market is also facing considerable uncertainty. Concerns around political action have paralyzed many investors.

And recent weak guidance from retail giant Walmart (WMT) reignited fears around consumer strength.

That means that the market is stuck waiting for the beginning of the next quarter. And it's waiting for the general concerns around economic uncertainty to play out.

Until then, we're likely to see continued volatility.

Importantly, that doesn't mean I see this year as a wash...

If you look back up at the chart, you'll notice a green dashed line to mark a resistance level near SPY's prior high. That's about $610. It's another level I had my eye on with that recent range of movement in the S&P 500.

And as I told Chaikin PowerFeed readers on January 31...

2025 is shaping up to be a big year in stocks. And it all starts with the "5x Signal."

The 5x Signal is easy to understand. It triggers when the S&P 500 suffers a single "down" month followed by five straight "up" months.

As we saw in 2024, "record highs" can happen a lot during big bull runs. The 5x Signal doesn't occur as often. Over the past 70 years, it has only happened 30 times.

And as I continued, this signal points to even more gains ahead...

In the first 29 instances, the S&P 500 was up a year later 93% of the time. And even when you factor in the two "down" cases, the index had gained an average of 13% a year later.

I brought all this up because the 5x Signal had triggered for the 30th time this past September. Based on history, the odds are in our favor for a big opportunity in 2025. And as I continued, there's more to the story...

Even better, the election is finally behind us...

When the 5x Signal flashes in an election year, most of the overall market's gains come later. They're essentially pushed into the post-election year – in this case, 2025...

History tells us, with 93% accuracy, that we'll see higher stock prices in the coming months.

Folks, we've seen a lot of uncertainty so far in 2025. But again, history tells us that there's still considerable upside potential ahead.

That said, it's important to be careful right now. Stay disciplined and follow your stops. And don't chase positions down a hole.

We're in a high-volatility environment. But don't give up on looking for opportunities...

Big moves are still coming in this market. As investors, it's our job to make sure we're positioned for them.

Good investing,

Marc Chaikin

Editor's note: Volatility is spiking... and for many folks, it seems a violent shift is unfolding in U.S. stocks today. But according to Marc, it's opening up an extraordinary moneymaking opportunity if you understand what's coming – and how to prepare.

Yesterday, he stepped forward to reveal his "secret weapon"... along with a powerful, little-known strategy that could help you potentially lock in rapid returns – even if markets crumble. If you have any money in the market, you'll want to hear the one move he recommends you make right now... Click here to learn more.