$TZA is a 3x leverage Bear Etf that tracks $IWM. This is my pick through the next 6-12 months as we are entering into an environment of stagflation or a recession. If we continue to increase rates with inflation staying high, it will lead to stagflation. If we raise too quickly and inflation comes down, it will send unemployment much higher and push us into a recession. We very well could already be in a recession now given the macro economy.

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$TZA is showing signs of Wyckoff Accumulation which is often used my many hedge funds and big money to show accumulation of a stock. As seen below, it fits accumulation perfectly which should continue to climb into the gap fill around $90 resulting in over a 100% gain.

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In addition to the incredible TA setup, we are seeing a balance sheet runoff within the market as seen below. This is set to double at the start of September which should continue to put downward pressure on the market resulting in much higher prices for $TZA.

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Many people look at yield curve inversions as when we are entering into a recession over the next few months and as seen below, we have experienced a significant inversion.

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As we are in a recession and the balance sheet is experiencing run off, the chart below shows how small caps perform in comparison to mid/large caps during a recession and after. As we are in or entering a recession, small caps significantly underperform which will allow $TZA to see much higher levels.

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Given the macro economic trends and relative weakness in small caps compared to other stocks in a recession, my buy the dip pick this month is $TZA. I think this has 100% upside potential over the next 6-12 months and can be used as a hedge to play the downside of the market.

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Feel free to comment below your thoughts on $TZA as I will be adding this position aggressively if we see any buy up in the market to allow $TZA to be bought at cheaper prices.

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#buythedip My goal is to have the best return over the next 6-12 months. Even if I do not win the competition, our portfolios can win with $TZA.