Democrats, Republicans and independents woke up to some good news on Wednesday: The election is over. Of course, about half of country sees the outcome as bad news while the other half views it as good news. But most people are glad the campaign has ended. 

From my perspective, at least the ads are done and now we can plan for the future without the uncertainty of an election looming over us.

#-ad_banner-#Now that we know who will be in the White House next year, planning a strategy for the market might be fairly easy. The presidential cycle is a four-year pattern in the stock market that many analysts have identified. 

There are variations of this pattern, with some analysts starting the cycle in January when the president assumes office while others believe it starts in November with the election. Despite these differences, there is a general consensus that the first two years of a president’s term are the most difficult for the market.

Once in office, a new president must make a variety of tough decisions. There are almost always problems the previous president was unable to resolve. Then there are new problems that develop. The essence of the job is to try to solve those problems. 

In the first two years, presidents seem more willing to take tough action, hoping the voters will forget about the consequences before the next election is held. In the past, this has led to below-average stock market returns in the first two years of a new president’s term.

President Trump may face a rough start to his term. We can speculate on policy, but no one knows what will happen in the first 100 days after the inauguration parade wraps up. The one thing we do know is that there’s a good chance the next president will face a recession and a bear market. But that forecast was likely no matter who won.

According to an article published before the election, economists in The Wall Street Journal’s latest monthly survey of economists put the odds of the next downturn happening within the next four years at nearly 60%. 

One reason to expect a recession is simply the age of the current expansion. For now, the economy continues its slow recovery from a deep recession that started in December 2007 and ended in June 2009. 

The Wall Street Journal noted the current expansion “has now continued for 88 months, making it the fourth-longest period of growth in records stretching to 1854.” Since the end of World War II, there has been a recession, on average, about every 70 months. 

And even presidents can’t restart the clock. The current expansion is old, and it could end at any time no matter who’s in the Oval Office. Bear markets often accompany recessions, so we shouldn’t be surprised if we see a bear market at some point in the next four years. Knowing the first two years of the term are the most dangerous for the stock market, on average, we can expect the long-running bull market to struggle in the near future.

But the best defense against the expected bear market is to avoid overpriced stocks that are likely to suffer steep losses in a bear market and instead focus on stocks that offer value. That includes stocks like the one I recently recommended to readers of my premium newsletter, Income Trader.

The pick, pharmacy chain Walgreens Boots Alliance (Nasdaq: WBA), continues to grow through a combination of strategic acquisitions and expanding its retail network. Acquisitions are also allowing it to reduce costs through synergies and economies of scale. These trends will allow the company’s share price to grow, regardless of the market’s performance.

I simply don’t have the space to get into all of my analysis for this pick in today’s issue, but a conservative price estimate puts shares at 13% above current prices by next year. This makes this stock a good choice no matter your investing goal. However, I’ve identified something even better: a short-term trade based on this stock that can quickly deliver a 40% annualized return. 

This is only one example of the type of quick gain that you should be searching for as the market turns bearish in the coming months. If the market gets volatile, you simply can’t afford to wait around to see if a stock pick pans out. But as other traders turn to safer assets, there will be plenty of opportunities for the savvy ones among us to profit. 

If you’d like to learn more about the strategy we’ll use to potentially net a 40% annualized gain from Walgreens, I invite you to follow this link. And if you choose to join my subscribers and me at Income Trader, you’ll receive a number of trades that have the same kind of potential each week. For more information, click here.