Jeff’s Note: Earlier this year, my colleague Mason Sexton made his first “Prophecy” in 30 years: that the market would top out in late July. That call was spot on. Now he’s coming forward with his next installment – his “Second Insight.”
As someone who foresaw the 1982 bull market, the 1987 crash, the bottom of the Great Financial Crisis, and so much more, Mason truly has a knack for these predictions.
This week, he is hosting a tell-all event where he may just catch everyone by surprise with this big idea. So click here to join in on November 14 at 8 p.m. ET when Mason reveals his prediction.
My name is Mason Sexton, and today I’ll show you something you’ve never seen before…
It’s a pristine example of a trading strategy that will seem unusual, perhaps even a little crazy. But just bear in mind that this is the exact methodology I’ve built my five-decade career on.
It’s the exact same analysis I send to my institutional clients, who pay thousands of dollars each month. And it’s what has allowed readers to profit time and again while most investors were losing their shirts.
But fair warning, it will be controversial, even unbelievable. But if you can keep an open mind, then read on.
It all comes down to a concept known as “harmonics.”
Price is Time and Time is Price
It is my firm belief that – like the wind and the tides – markets move in predictable cycles. This idea runs counter to what many investors believe. They look at the daily movements of stocks and see only chaos.
But it’s not controversial to believe that the seasons move in cycles. Investors are likely familiar with the concept of a “business cycle.” Even history is said to move in “great cycles” through the centuries.
Is it so hard to believe that markets, too, move through great cycles?
If you can open yourself up to this possibility, you begin to see the chaotic movements of financial markets in an entirely new way. You begin to see harmony.
And predicting the changes in markets comes down to identifying a “harmonic” occurrence of price and time.
Here’s what I mean…
At its most basic level, a stock chart is simply a representation of price and time. The vertical scale is price. The horizontal scale is time.
Part of my work comes down to discovering a geometry where naturally occurring units of price occur in a harmonic relationship with naturally occurring units of time.
A key concept that many struggle with is understanding that price and time are equal. They are the same thing: Price is time. And time is price.
After all, it is only with the changing of price that we might understand time (a stock was $5 yesterday, but $6 today). And we may think of time as an organizing principle. It is only through the elapse of time that support and resistance levels are created in price.
Allow me to show you what this looks like with a real-world example…
Shorting the Leader
In 2023, the most beloved stock is none other than Nvidia (NVDA). As the leader in AI hardware, NVDA has served as a bellwether for the entire market this year. And – until very recently – investors were almost universally bullish on the stock.
As I told readers on October 6:
“Goldman Sachs Pounds the Table on NVDA.” That’s the headline of an article published yesterday by TipRanks. And according to the article, of the 40 analysts in the “flock” that cover Nvidia, 39 have a buy rating with just one hold.
As a contrarian, that fact alone motivates us to want to sell short the stock at the first opportunity.
If my 50-plus years on Wall Street have taught me anything, it is this: When such a uniform consensus exists among so-called “analysts,” it is always wrong.
As it happens, we did short NVDA a few days later. And the reason for this short had everything to do with the concept of harmonics, mentioned above.
As I told readers at the time:
Incredibly, the stock is exactly one “solar year” – or 365.24 calendar days – from the October 14, 2022, bear market low of $108.13. That’s at a price of $473.37 where it traded at most of yesterday morning.
This defines a “perfect square out” of 365.24 days x $365.24. This holds the potential to form a historic peak…
What does this mean in plain English?
It means that NVDA bottomed on October 14, 2022. From there, it climbed $365.24 over the course of 365.24 days.
Notice that the range in price is exactly the same as the range in time. The stock moved $365.24 higher over the course of 365.24 days.
I would call this a “square out” or a perfect harmonic convergence between price and time. As I said above, price is time and time is price. Below, you’ll see the chart shared with readers at the time.
I understand this chart can appear very busy. I just ask that you look at the yellow box in the upper right corner. This was the moment when NVDA reached a price/time resistance.
I told readers to short the stock and that it would trade all the way down to $417. And that’s precisely what happened. The stock proceeded to fall that very day and was down as much as 12% two weeks later.
The bulls buying into that top were licking their wounds. But readers were prepared. We closed out the short for a fabulous, annualized return around 450%.
Here’s what one reader had to say after the trade:
What you do is IMPOSSIBLE. I am just glad that nobody ever told you that. I have profited greatly from your recommendations. In just two months, this is beyond believable. I pray that you live long and prosper!!!
– Pete B.
It may seem impossible, but readers have executed similar trades time and time again using this concept of harmonics as a guiding light.
This is not your “average” investment analysis. But if you rely on “average” analysis, you’ll see average returns. In the case of NVDA, the average analysis would have led to double-digit losses in under two weeks.
And I firmly believe that adopting this strategy will be essential to thriving in the difficult years ahead.
The New Paradigm
The central premise of this research is that we have entered a “new paradigm.” And in this new paradigm, the rules of investing will be very different. At a high level, I predict we’ll see a “replay” of the 1973-1983 period.
From January 1973 to the end of 1983, the Dow climbed only 26%. That represents an abysmal annualized return of just 2.34%. But this nominal return hides the true carnage. Adjusted for inflation, the Dow declined by some 50% over those ten years.
I remember that treacherous stretch clearly. It began shortly after I got my start in finance in 1972, after graduating from Harvard Business School that spring.
Right now, 99% of investors are simply not prepared for what’s about to unfold.
And the next leg of this long-term forecast is set to kick off in the coming days.
Starting on November 22, I predict a market event will begin to unfold that will surprise everybody. And for those of us who prepare, it could be an incredible trading opportunity.
To help you prepare, I’m hosting a special event on November 14 at 8 p.m. ET. On that date, I’ll share my prediction for the next six months. I’ll also give you precise dates to look out for.
Most importantly, I’ll reveal my “new paradigm strategy” to profit while most investors are caught flat-footed. So, mark that date: November 14 at 8 p.m. ET.
You can reserve your seat with one click right here.
As always, thank you for being a reader. We’ll speak again soon.
Founder, New Paradigm Research