Tom Yeung here with your Sunday Digest. 

Every parent knows that the concept of “gravity” comes naturally to children.  

By 3 months, many infants can follow the path of a bouncing ball. Nine-month-olds throw food off tables to see the splat. By 2 years old, they’re at jungle gyms doing that with their whole bodies. My local urgent care clinic is routinely filled with grinning kids in arm casts. 

Fascinatingly, gravity is also found in investing.  

Many assets trend toward a central value as if pulled by an invisible force. One massive “up” day is often followed by an equally strong “down” day. And much like 2-year-old daredevils, investors who ignore this fact often injure their bank accounts. 

That’s because most assets have an “intrinsic value,” a fundamental worth that acts almost like a gravitational pull. An investor might pay $100, $200, or even $500 for a stock in the short run. But if shares are only worth $50, prices will eventually come back down to Earth.  

It’s why asset bubbles never last forever.  

Recoveries work the same way. High-quality stocks in oversold territory tend to rebound.  

Dollar General Corp. (DG) fell as much as 70% in 2023-’24 before I named it my No. 1 “best of the best” stocks for 2025. Shares are up 45% since then.  

This cyclical pattern is why buy-the-dip strategies are often called “swing trading.” The strategy relies on a pendulum-like gravitational pull. 

However, timing these swings is tricky. One of my “best of the best” picks for 2025 is still down 28% on weak air travel demand. And plenty of failed Wall Street traders will say they were right… except they were too early or late. 

That’s why the analysts here at InvestorPlace have increasingly used quantitative tools to help time the market. These statistical and AI models are designed to sniff out smart money purchases and unusual price signals that suggest a rebound.  

Now, a system co-designed by TradeSmith Senior Analyst Jeff Clark is sounding the alarm. The master trader and 40-year market veteran has identified what he calls the “chaos pattern.” Every time it shows up, the markets become even more uncertain and volatile. 

And now… it’s just reappeared.  

On Wednesday, June 11 at 10 a.m. Eastern, Jeff will explain everything during his Countdown to Chaos event (sign up here). He’ll explain why volatility is about to spike, and how to use this concept of “gravity” to come out ahead. 

The event is free to attend, but I urge you to register for the broadcast here in order to save your spot. 

Obviously, I can’t fully reveal Jeff’s trading system here. You’ll have to see it for yourself in his upcoming presentation.  

But what I can do is give you three of my own swing trade stocks, chosen with the help of one of our quant systems. And with these, it becomes apparent why a volatile market will provide some golden opportunities for swing-trade profits. 

A Top AI Play 

When I first heard of “Agentforce,” I thought it was an advertising joke gone wrong. Surely, the well-paid marketers at Salesforce Inc. (CRM) could dream up something better to market their new AI agents. (SAIlesforce, perhaps?) 

Yet, the demonstration I saw of Agentforce was jaw-dropping. Entire customer service operations can now use this platform to automatically answer questions, route callers to the appropriate human agents, and more. It was the first time I’d seen a full-blown AI system in the workforce. 

This cutting-edge technology has translated into real-world results. On May 28, Salesforce reported a “beat-and-raise” quarter. Earnings per share of $2.58 beat Wall Street forecasts by 1.4%, and management upped their full-year guidance by an even greater amount. Agentforce is already bringing in more than $100 million in annual recurring revenue. 

Markets were somehow unimpressed. CRM shares fell 5% the following day, driven by news that a federal appeals court temporarily reinstated President Donald Trump’s tariffs. This is the kind of volatility that temporarily pushes share prices away from intrinsic value. 

That’s why a rebound is so likely. Salesforce has little exposure to tariffs, and its “beat-and-raise” quarters should trigger a slow burn of analyst upgrades. This is typically a bullish sign of greater gains to come. Analysts have already upped their 2026 earnings estimates for CRM by 1.5%, and our AI system predicts as much as a 14% upside in the next 30 days. 

Best of all, Salesforce is also a compelling “buy-and-hold” company, thanks to its leading position in AI and its reasonable share price. The stock trades for just 23 times forward earnings, making it a rare swing-trade stock with significant upside. 

The Low-Tech Winner 

A separate catalyst is forming in timber – a market previously hammered by cheap salvage wood in the aftermath of the 2024 hurricane season.  

On September 26, 2024, Hurricane Helene landed in the Big Bend region of Florida and made its way through timber-rich Georgia. The Category 4 storm damaged nearly 70 million tons of timber and created a bonanza for salvagers selling cheap raw materials. 

These cut-price supplies are now running out. The U.S. Forest Service began phasing out salvage harvesting operations in May, and the value of remaining unharvested wood is (quite literally) rotting into the earth. 

That’s good news for Weyerhaeuser Co. (WY), the largest timberland owner in North America. The firm holds 10.4 million acres in the U.S. and another 14 million acres under license in Canada, making it over four times larger than its closest competitor, Rayonier Inc. (RYN).  

Cheap wood supplies had caused Weyerhaeuser’s pretax income to shrivel 26% year-over-year in the first quarter. Analysts now expect the loss to narrow to 19% in the second quarter before disappearing in the third quarter. 

In addition, a broader three-year slump in lumber demand seems to be ending. Mortgage rates have stabilized, and the number of new housing starts has increased roughly 6% since last summer. This is a positive sign for Weyerhaeuser, which saw share prices rise over 110% during the previous construction boom in 2020. 

Over the next 30 days, our quantitative system projects a 9% increase in WY shares. Salvage wood caused a short-term spike in downward volatility, and the effect is quickly wearing off. 

Buying the “Gone Too Far” Dip 

My final suggestion this week is Magna International Inc. (MGA), a Canadian auto parts manufacturer that has seen shares drop 65% since 2021. 

At first glance, Magna is not an obvious pick. Seventy percent of the firm’s revenues come from the “Big Three” U.S. automakers and two German brands. Tariffs have hammered these five customers, denting Magna’s profits like an old car hood.  

Analysts expect MGA’s return on equity to fall from its typical 16% level to 10% this year. Revenue is expected to shrink 5%. 

Magna also faces competitive threats from China. The Canadian firm has struggled to embed itself in Chinese vehicles, and customers like BMW and Mercedes-Benz face rising competition from these new rivals. Shares have been incredibly volatile, falling 26% this year before rebounding 20%… and then declining again in recent weeks on renewed tariff fears. 

However, the selloff seems to have finally gone too far. Today, Magna trades under 8X forward earnings and 0.87X price-to-book value, at least 40% below its justified valuation, according to three-stage discounted cash flow models. In addition, analysts have flipped bullish on Magna’s prospects, upgrading 2025 earnings by 7% over the past 30 days. 

There are some good reasons for the optimism… 

• Tariffs. The White House’s appetite for further tariffs seems limited. The 50% duty on imported steel and aluminum announced on June 3 excluded wide swaths of downstream products, including automobile parts.  
• Demand. Retail vehicle sales have risen strongly this year, according to Cox Automotive. Supplies remain tight, and retail prices have stabilized. 
• Earnings. Analysts are finally turning positive on MGA’s earnings. The average analyst revision has involved a 7% increase in 2025 earnings per share estimates, suggesting profits will dip just 15% this year before fully rebounding in 2026. 

Our quantitative system forecasts a 11% return over the next 30 days. 

Mastering the Art of Swing Trading 

You’ll quickly notice that all three picks this week are stable companies that have been around for decades. Salesforce was founded in 1999 and is widely considered the first successful software-as-a-service (SaaS) company. Magna International was founded 68 years ago, and Weyerhaeuser began 57 years earlier in 1900. 

That’s because volatility is excellent news for strong companies. These three firms have withstood bubbles… recessions… one has even survived through two World Wars. If shares go down, it’s a signal to buy.  

In a brand-new presentation, Jeff Clark outlines how he’s used this concept to come out ahead, no matter which direction the broader market moves. In fact, 2008, 2020 and 2020 – three of the most devastating years for the average investor – turned out to be among the most lucrative years of his career.  

Much of this comes down to timing. Jeff has a superb record of identifying when volatility will spike and the market “pendulum” swings far from center… and the new quant system he helped design and is debuting at his free presentation will improve that excellent track record. 

These are excellent moments to make investments. 

The other part is asset selection – finding the stocks and options that will swing back to where they “should.” Here, Jeff is also an expert, showing his followers how to make gains like… 

• 250% in 14 days from Wheaton Precious Metals Corp. (WPM)…  
• 233% in 13 days from D.R. Horton Inc. (DHI)…  
• And an incredible 490% in only 25 days from Palomar Medical Technologies.

That’s why I’d like you to sign up for his upcoming presentation, the Countdown to Chaos event (register here).  

During that free event, Jeff will explain the volatility he sees coming and demonstrate his “chaos pattern” system. He’ll show how his approach can help investors profit while others panic, providing the exact steps you need to take to potentially double your money at least six different times. 

All you have to do is click here to save your spot.

Until next week, 

Tom Yeung 

Market Analyst, InvestorPlace