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Why the Next Great Tech Bull Market Has Begun

  • Tech stocks have been crushed all year because of decades-high inflation.
  • While the rate of deceleration slowed last month, disinflation still happened.
  • Every time over the past 50 years (excluding 2000-2001) that tech stocks rallied 20% off recent lows, as they did in June and July, they soared over the next 12 months.

A sculpted casting depicting a bull in dramatic contrasting light

[Editor’s note: “Why the Next Great Tech Bull Market Has Begun” was previously published in July 2022. It has since been updated to include the most relevant information available.]

The tech sector dropped like a stone this year. So, it’s easy to forget the cardinal rule that marks many a bull market: Tech still rules the world.

Here’s a little news flash. Tech stocks have entered a brand-new bull market that could be the start of a massive 50%-plus melt-up. And certain tech plays could see a 10X surge higher!

The reason behind this is deceptively simple.

Tech stocks have been getting slammed all year long. The sector gave back roughly 30%, while many individual names plunged 70% or more.

That selloff had nothing to do with fundamentals. Everywhere, folks are still using technology to do everything. They’re still all shopping on Amazon (AMZN). They’re still watching Netflix (NFLX), buying Apple (AAPL) products, and working with Microsoft (MSFT) software.

Tech stocks were crushed because of this little thing called inflation. Indeed, that became a big problem in 2022 – for the first time in 50 years.

And now that big problem is starting to fade. Yes, August’s CPI was hotter than expected. Consumer prices rose 8.3% that month. But they rose 8.5% in July and 9.1% in June. That trend is still disflationary. And that’s bullish.

So are the fundamentals – and the technicals. All evidence points to this new bull market being the real deal.

If that’s true, the data says tech stocks will rip higher by 50% over the next 12 months. In fact, dozens of select tech stocks should rally by 1,000% or more.

And we’ve found one tech stock we think can rally 10X before the year’s end

In other words, investors who buy the top tech stocks today will make fortunes over the next 12 months.

Let’s make sure you’re one of them.

Inflation Is Dying

Since late 2020, inflation has been doing one thing and one thing only: Getting hotter, and hotter, and hotter. Every. Single. Month.

That trend finally broke in July.

Of note, July’s report included a number of bullish post-pandemic firsts for inflation. For the first time, inflation was negative on a month-over-month basis and rates dopped more than 50 basis points sequentially. Also for the first time, energy prices fell in a major way.

Chart exemplifying inflation

Now, across the board, August’s CPI numbers topped expectations. Headline inflation rose 8.3%, versus 8.1% expected. Core inflation rose 6.3%, versus 6.0% expected. Month-over-month inflation rates topped expectations, too.

But while spooky, it is VERY important to note that despite the beat, headline inflation rates are still falling. That is, headline inflation was 9.1% in June. It dropped to 8.5% in July and fell again to 8.3% in August. So, while the rate of deceleration slowed last month, disinflation still happened.

We fully expect inflation rates to continue their deceleration over the next 12 months. As they do, tech stocks will soar – and certain small tech stocks will soar 10X or more!

Bull Market Fortunes Are on the Way

In truth, we’ve been bullish on a new tech bull market for the past two months. Why?

July’s inflation print was so good that tech stocks soared about 3%. That continued what had been a big rally ever since mid-June. By definition, that means tech stocks officially entered a new bull market.

Sure, that’s just a definition. But it’s also very meaningful.

This technical indicator has successfully predicted every tech-stock bear market’s end over the past 50 years. except the dot-com crash. And this isn’t the dot-com crash, since valuations at that time were about 50% higher than they are today.

To that end, every time over the past 50 years (excluding 2000-2001) that tech stocks did rally 20% off recent lows as they’ve done over the past two months, they soared over the next 12 months.

The average 12-month-forward gain? Almost 40%. The average 12-month gain in the most recent examples from the past 20 years? Nearly 50%!

Nasdaq Composite Performance following bull market entry

In other words, tech stocks flashed an ultra-rare “bull market entry” signal back in July. And it has a 100% track record (excluding the dot-com crash) of predicting big tech-stock gains over the next year.

The investment implication? The odds are very high that tech stocks surge about 50% over the next 12 months.

If they do, then history also says potentially dozens of small-cap tech firms will soar more than 10X as well.

And one stock in particular has the potential to bag 10X gains over the next month alone…

The Final Word

Lots of investors think money is made in bull markets.

That’s true. Money is made in bull markets. But fortunes are made in bear-to-bull market transitions.

In those periods, investors have the opportunity to score a decade’s worth of returns in a single year. They have the opportunity to see their investments soar 5X, 6X, even 10X in value in 12 months or less.

It’s a once-in-a-decade investment opportunity. It’s happening right now. And all investors have to do to capitalize on it is buy the right tech stocks today.

We’ve spent the past several months scanning the market for the highest-upside-potential tech stocks in this bear-to-bull market transition.

Ultimately, our research led to us to one stock being the single best buy in the market right now.

What makes this stock so special?

Well, it’s smack dab in the middle of the most promising economic opportunity of our lifetimes. I’m talking about capitalizing on the Space Economy. The opportunities that lie within are about as infinite as space itself. And the stock I’m focused on is the only one that can realistically soar 10X in a hurry.

Seriously. If proven successful, this company is primed to change the world. And its stock could really rise by 10X or more in that time.

It is a stock you simply need to know about today.

On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.


Article printed from InvestorPlace Media, https://investorplace.com/hypergrowthinvesting/2022/09/why-the-next-great-tech-bull-market-has-begun/.

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