We spend a lot of time and effort writing our market forecasts every year. In this article we will try to summarize the 5 most important investing tips for investors based on the 2023 forecasts we have published so far. In other words, we don’t look at individual markets but we think from the investor’s perspective. Which investing tips can help determine terms do’s and don’ts in 2023, which markets look good, which investing types should be considered and which ones not? Note that this article is based on the forecast that there will be no stock market crash in 2023.
The tips shared in this article are based on the following forecasts we recently published:
Which Is The Biggest Investing Opportunity Of This Decade? (published 18 months ago)
Investing tip #1. Quality stocks above momentum stocks
Investing tip: Initially, the focus of investors should be on quality stocks that generate revenue and keep on growing. As time passes, some more focus on momentum stocks are allowed.
2023 should come with rising inflation expectations.
We used TIP ETF throughout our 2023 forecasts as a recurring topic, the red line. It is a measure for expected inflation came down aggressively in 2022. That’s because of the very aggressive stance of the U.S. Fed as well as other monetary policy makers globally. However, we believe the decline of TIP ETF has run its course. As seen on the chart, the decline in 2022 touched a rising trendline that is dominant since 18 years.
What this really means is that monetary policies should soften in 2023. Inflation expectations can rise again, presumably moderately (at a more regular pace closer to the 2% desired inflationary rate).
Typically, stocks tend to react to the rise of TIP ETF in a cyclical way: first quality stocks go up, at the end of the uptrend in TIP ETF (top of the long term channel) are momentum stocks reacting to the upside.
That’s why momentum stocks should (a) only be considered towards the end of 2023 (b) some of them, beaten down quality momentum stocks, can be picked up at discounted prices in this early stage.
Investing tip #2. The EV boom continues
Investing tip: EV sales continue to boom, beaten down EV stocks that are keeping their delivery and production promises can be bought.
The EV boom is for real.
However, not all EV stocks are worth your portfolio.
We have said repeatedly to only consider EV stocks that have a long and visible (proven) production backlog with paid pre-orders and confirmed production plans.
This seems an obvious list of criteria, it certainly is an obvious list, however the number of EV companies that are meet all criteria is limited.
Moreover, the key commodities for the EV space are lithium and graphite. Top lithium and graphite stocks are a must-have in any long term portfolio.
Investing tip #3. Watch rate and USD sensitive stocks
Investing tip: The USD will come down in 2023, so will yields. Stocks that are rate and USD sensitive should be considered early on in 2023.
Further to tip #1 which was all about rotation from quality (early in the year) to momentum (late in the year) we believe that USD and rate sensitive stocks can be considered.
It is really easy to find the sectors that are USD and rate sensitive: just look at which sectors outperformed last week, when the USD and rates came down a lot.
Those sectors will do well in the first half of 2023 because it is now clear that both the USD and rates are topping.
Investing tip #4. Volatility readings will gradually decline
Investing tip: We believe that better times are underway. VIX is setting lower highs on its weekly chart. It might finally fall below its 200 WMA which would be great news. 2023 will be really different.
Volatility levels were persistently high in 2022, however we expect that the average volatility level will be lower in 2023. This really means that investors can buy the dip, respecting the other investing tips shared in this article.
Investing tip #5. Watch for silver’s secular breakout
Investing tip: The price of silver will move to our first target which is 28 USD. Once it is able to clear secular resistance at 28 USD, we see a quick move to 34.70 USD or even 41 USD in 2023 or 2024.
Silver is the outlier in 2023.
It is the market with explosive potential.
However, we must be patient and see the bullish confirmation appear on the silver chart. This might take many more months, ultimately we expect somewhere in 2023 to see an explosive move in silver.
This is what we wrote in our silver forecast:
As seen on the longest timeframe, the silver price chart over 50 years, there is a giant cup and handle in the making. This is a strongly bullish pattern, one that might take two more years to truly explode.
- Leading indicators Euro and inflation expectations turned bearish in Q2/2022, pushing silver lower.
- The silver CoT turned extremely, historically bullish as we head into 2023.
- Once the Euro and inflation expectations start rising, we silver see taking off.
That’s why we see silver easily moving to 28 USD in 2023 and moving to our first and longstanding bullish target of 34.70 USD. Our silver price forecast 2023 is 34.70 USD. Whatever happens at that price point will inform us about the intention of silver to attack ATH, presumably near the end of 2023 or in 2024.
Silver is the outlier, the bonus, the wildcard in the game. If and when silver takes off, it will be ‘hallelulaj time’. Investors should not wait for this to happen, they should start accumulating silver assets over time to be well positioned once the silver market starts booming. It’s a matter of time, but don’t wait for it. Rather, let it happen.
Must-Read 2023 Predictions – We recommend you read our 2023 predictions as they are very well researched:
Which Sectors Will Be Bullish In U.S. Markets In 2023?
A Stock Market Crash In 2023?
A Silver Price Forecast For 2023
2023 Market Trends
5 Investing Tips For 2023
A Very Bullish Graphite Stocks Forecast For 2023
Healthcare & Biotech Stocks: A Big Opportunity In 2023
Lithium Forecast: Lithium Stocks Will Be Wildly Bullish In 2023
Which Precious Metal To Buy For 2023?
A MATIC Price Forecast For 2023
5 Cryptocurrency Predictions For 2023
A Gold Price Forecast for 2023
An XRP Price Forecast For 2023 *3 USD*
Why Markets Should Resume Their Uptrend The Latest In March of 2023