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Felix Prehn - You Won’t Believe What Jerome Powell Said… + Stock Market News 09 July 2024 · Felix Nikolas Prehn's Podcast

• 0:00
  Speaker 1: Thanks, sam, and welcome to this excuse me, tuesday morning, a day when Fed Chair Powell is going to be grilled, interrogated, questioned, which, of course, is incredibly important for the market.
• 0:12
  Speaker 1: But there are a few other things we need to look at, but definitely our focus will be interest rates and what do we buy, what do we invest in?
• 0:20
  Speaker 1: Goldman Sachs coming out today saying AI stocks might be too expensive.
• 0:24
  Speaker 1: Citi similarly warning that we might want to shift from the current AI rally to some broader AI stocks.
• 0:33
  Speaker 1: I'm going to walk you through all of that yesterday to make you the best informed investor out there.
• 0:38
  Speaker 1: That's always our goal, that's always our mission and in light of that mission, I'm also running a live free trading training in literally 58 minutes.
• 0:47
  Speaker 1: So at 10am New York time, that's 3pm London time.
• 0:51
  Speaker 1: If you want to join me pretty much straight after this, come over there to felictransitorg slash webinar and grab yourself a seat.
• 0:58
  Speaker 1: And why would you want to do that?
• 1:00
  Speaker 1: Because we run a trading portfolio, a teaching portfolio, that is $30,000 in size, $30,000 in size, and so far this year we're up $16,000.
• 1:12
  Speaker 1: We've done similar feats in the last two years, so come and learn how we do that and how.
• 1:18
  Speaker 1: That isn't chance or luck, but it's simply three rules.
• 1:21
  Speaker 1: We trade a three rules-based system and I'll teach you that exact system.
• 1:26
  Speaker 1: I'm never promising you real returns, by the way I want to be very clear on that but I promise to teach you what I do and how I do it.
• 1:32
  Speaker 1: So come and join me over there Links down below in the description.
• 1:35
  Speaker 1: And as they say in Spain, and here is Sidi saying it's time to book profits and high-flying AI equities.
• 1:41
  Speaker 1: And profits and high-flying AI equities and we're starting to hear this a little bit more it's caution.
• 1:52
  Speaker 1: Of course there is some sense to caution, I get that, but I think one of the big things with it is that what has gone up, what's been the AI rally Well, it's been all hardware, really hasn't it?
• 1:59
  Speaker 1: It's mostly hardware, so it's your NVIDIAs and the likes, but software actually hasn't really done much.
• 2:08
  Speaker 1: So AI has mooned and software has sort of gone more or less sideways.
• 2:13
  Speaker 1: I think there are definitely some software plays to look at and to kind of broaden out our AI portfolios a little bit, and I have done some videos on that in the last week or so, or maybe even two weeks or so, and I'll keep covering some ideas over there.
• 2:24
  Speaker 1: So, yeah, I think there is no shame in taking profits.
• 2:28
  Speaker 1: And is it a shame in taking profits too early?
• 2:31
  Speaker 1: No, no, it's never too early.
• 2:33
  Speaker 1: It's just taking profits and in hindsight you know whether it was too early or not.
• 2:37
  Speaker 1: But you don't have the benefit of hindsight if you are making money right now.
• 2:40
  Speaker 1: You make money, you're doing something well.
• 2:42
  Speaker 1: Now does that mean it's all over and the party is stopping right here?
• 2:46
  Speaker 1: No, why not?
• 2:47
  Speaker 1: Because, well, first of all, historically, july is a glorious month.
• 2:51
  Speaker 1: It's the greenest month of all the months in the year, basically.
• 2:56
  Speaker 1: So July tends to do quite well.
• 2:58
  Speaker 1: I'm not quite sure why.
• 2:59
  Speaker 1: To be honest with you, I can't really find a real reason for that.
• 3:03
  Speaker 1: Maybe everybody feels good, the sun's out and that kind of thing.
• 3:06
  Speaker 1: I don't know.
• 3:07
  Speaker 1: Maybe the short sellers are on holiday on their yachts or their islands or something like that.
• 3:13
  Speaker 1: I can't really tell you why, but there is some historic fact here that things tend to go up rather nicely in July and we have pretty good support, also from our friends, the market makers and it's an odd concept, market makers but basically when we buy or sell an option like what I do, it's not you on the other side or another retail trader it's typically a market maker and they then hedge that position so they have zero risk and they just make money on the margin.
• 3:46
  Speaker 1: Essentially, they just make a margin, zero risk margin.
• 3:48
  Speaker 1: So at the moment they're very what we call long gamma.
• 3:52
  Speaker 1: You know, descriptive, isn't it?
• 3:54
  Speaker 1: It's helpful, isn't it?
• 3:54
  Speaker 1: Tell somebody you know and say, oh, we're very long gamma today.
• 3:57
  Speaker 1: What the heck does that mean?
• 3:58
  Speaker 1: It means as we go up, they buy, basically, or it's supportive, but if we go up more than 1.5% in the market, they start selling.
• 4:12
  Speaker 1: And that's again important to realize.
• 4:14
  Speaker 1: And I'll give you the exact data points so you know what it is.
• 4:18
  Speaker 1: I'll put all of this on a chart for you.
• 4:19
  Speaker 1: I think I already have Also CTAs, so CTAs are algo funds.
• 4:23
  Speaker 1: You know, the dumb money, the real dumb money.
• 4:26
  Speaker 1: There's computers trading on certain indicators and they start selling below 5,387.
• 4:32
  Speaker 1: We're quite a lot above that right now, right.
• 4:34
  Speaker 1: So here is the chart of the day.
• 4:37
  Speaker 1: You might want to take a screenshot off, and this is from Trade Vision, which is a software we built, and first of all, you've got support at 5,500.
• 4:45
  Speaker 1: This is the support.
• 4:47
  Speaker 1: And why is that?
• 4:49
  Speaker 1: Because you've got this little red bar here that I'm pointing at.
• 4:53
  Speaker 1: That's your support.
• 4:55
  Speaker 1: There's a little bit at 5,450 as well, and then the big one at 5,400.
• 4:59
  Speaker 1: And just below 5,400, just below that, at 5,387, the CTAs will start to sell.
• 5:07
  Speaker 1: So we're in pretty good, safe, comfortable zones up here.
• 5:13
  Speaker 1: You just don't want to start dropping through 5,500 and then towards 5,400, because then it gets ugly.
• 5:18
  Speaker 1: Just so you know that it doesn't mean it's going to happen, but just now you know.
• 5:21
  Speaker 1: Now you know what the setup looks like, right.
• 5:22
  Speaker 1: So you probably, if we hit 5,500, see a little bit of a bounce up and then hopefully everything will be all right.
• 5:27
  Speaker 1: But if we break through that, then the drop could be quite rapid.
• 5:33
  Speaker 1: Now, what's Jerome Powell going to say today?
• 5:36
  Speaker 1: So he gets grilled by a bunch of politicians.
• 5:38
  Speaker 1: Today.
• 5:38
  Speaker 1: I think it's Congress first and then Senate second.
• 5:41
  Speaker 1: Those are the other way around.
• 5:42
  Speaker 1: I never really know.
• 5:43
  Speaker 1: Martin says Stalin gives short-sellers access from the Canary Islands.
• 5:49
  Speaker 1: So they're still making money.
• 5:50
  Speaker 1: True, very true.
• 5:52
  Speaker 1: And Jad, yeah, we're glad you talked about it so far in a second as well.
• 5:59
  Speaker 1: But let's talk about Jerome Powell first, because he's speaking shortly, for like over an hour or something.
• 6:06
  Speaker 1: They're going to ask him all sorts of things, and it'll be very, very long questions that sound more like political statements, which is very irritating, but ultimately, the Fed has to cut interest rates.
• 6:17
  Speaker 1: This is one of the reasons why this is the cost of US debt, and it's already at over $1.1 trillion Bigger than the defense budget, yeah, and you know, in 2020, it was like half a trillion, so it's ballooned.
• 6:37
  Speaker 1: And that's interest rates and, of course, insane spending by politicians of all parties, who are all a bunch of nincompoops, if you ask me.
• 6:44
  Speaker 1: But you're getting also, aren't we getting?
• 6:49
  Speaker 1: When are we getting Trump's VP out?
• 6:50
  Speaker 1: Is that being announced?
• 6:52
  Speaker 1: I think shortly.
• 6:52
  Speaker 1: Right, that'd be interesting to see who he picks, but the market at the moment is predicting a September rate cut with a probability of 75%, which is pretty high.
• 7:08
  Speaker 1: So Jerome Powell, I think today will do his last rudder act to try and convince the market that he will stay the course and he'll be strong and all of that, but essentially, he's just going to come down to the same story he always tells, which is we have a dual mandate, you know, full employment and low interest rate, low inflation, that kind of thing.
• 7:29
  Speaker 1: So I don't think he's going to say that much and I think the market will quite like it, because unlikely he's going to say much, because I think he knows in the back of his mind that time's up and they need to start cutting rates.
• 7:39
  Speaker 1: They're not going to do it in July, they're going to want to make us sweat a little bit more.
• 7:43
  Speaker 1: But I think September is highly likely and of course, if it isn in September, november, I would say, is a shoo-in.
• 7:49
  Speaker 1: So why no October?
• 7:51
  Speaker 1: There are no October Fed meetings, I guess on holiday, enjoying the autumn leaves or something like that.
• 7:58
  Speaker 1: There must be a real reason for that.
• 8:00
  Speaker 1: You want CTA support charts for the Nasdaq too, cta.
• 8:06
  Speaker 1: I haven't got the number for the CTAs on my fingertips, but have a look at go over to Trade Vision and you can look it up for QQQ and the likes.
• 8:14
  Speaker 1: So is it priced in, says Ken, for September?
• 8:17
  Speaker 1: Yeah, I would say it's priced in for September.
• 8:19
  Speaker 1: So if we don't get it in September, we'll get a little bit of a kicking and then we'll likely get it in November and then everything is wonderful once again, hopefully with the president of your choice.
• 8:33
  Speaker 1: People get so upset.
• 8:34
  Speaker 1: I made a video the other day saying what stocks to buy if Trump wins.
• 8:37
  Speaker 1: There are comments like how dare you normalize a Trump presidency and you know that kind of thing.
• 8:44
  Speaker 1: It's just like calm down.
• 8:46
  Speaker 1: I mean it's just, you know, it's just four years.
• 8:48
  Speaker 1: It's not like they really run the country.
• 8:49
  Speaker 1: I mean it's just, you know, it's just four years.
• 8:50
  Speaker 1: It's not like they really run the country.
• 8:51
  Speaker 1: I mean you realize that, right, there are people who run the country all the time and every four years you happen to have an election to make you feel like you're kind of part of it.
• 8:59
  Speaker 1: It's not the purpose of democracy.
• 9:01
  Speaker 1: I thought that was the purpose of democracy.
• 9:03
  Speaker 1: I'm a cynic.
• 9:09
  Speaker 1: Aren't up Google, meta up slightly.
• 9:11
  Speaker 1: Apple basically flat.
• 9:13
  Speaker 1: Amazon flat.
• 9:13
  Speaker 1: Tesla down just a little bit.
• 9:16
  Speaker 1: The short sellers are doing a little morning dance or breathing exercises.
• 9:20
  Speaker 1: Perhaps Fat drugs are up.
• 9:22
  Speaker 1: Anything else majorly up.
• 9:24
  Speaker 1: What's that?
• 9:25
  Speaker 1: Intel is up.
• 9:26
  Speaker 1: Amd down a little bit.
• 9:28
  Speaker 1: So it looks pretty healthy, right, it looks pretty healthy as a market.
• 9:31
  Speaker 1: So I don't think the market's that worried about what Powell is saying today and tomorrow, because, yep, he is speaking not once but twice to delight us.
• 9:39
  Speaker 1: And used car prices are down some more.
• 9:44
  Speaker 1: If you care, if you want to buy a car, it's going to be a good opportunity, I think probably one of the last good opportunities.
• 9:51
  Speaker 1: And then day at 10 tomorrow, again at 10 for the second grilling.
• 9:57
  Speaker 1: And then thursday we get inflation data out.
• 10:00
  Speaker 1: So thursday, very important, mark that in your calendars and I think that couple of things are going to benefit from lower inflation numbers.
• 10:08
  Speaker 1: I think I think we're going to get some pretty decent inflation numbers.
• 10:11
  Speaker 1: That's my view of that.
• 10:12
  Speaker 1: And of course, the the complete joke that is jobs data, which is, you know, it's just made up.
• 10:17
  Speaker 1: Uh how they will.
• 10:18
  Speaker 1: Uh down, says felix.
• 10:19
  Speaker 1: How dare you hurt people's feelings?
• 10:21
  Speaker 1: I know, I know, I mean I people actually think I care.
• 10:24
  Speaker 1: I don't care, I'm just saying doesn't seem that unlikely trump might win if you look at current polling numbers and democrats wondering whether biden knows his name after 4 pm, and therefore I think it's a reasonable question to ask what would benefit from that, purely financially.
• 10:42
  Speaker 1: Just leave it at that.
• 10:44
  Speaker 1: But people have very strong opinions on politics.
• 10:46
  Speaker 1: I used to have strong opinions on politics.
• 10:48
  Speaker 1: I don't know.
• 10:49
  Speaker 1: No longer do.
• 10:49
  Speaker 1: I became a cynic.
• 10:50
  Speaker 1: I've never been happier.
• 10:52
  Speaker 1: Smash the like Freeloaders Thanks very much, david.
• 10:55
  Speaker 1: Appreciate that.
• 10:56
  Speaker 1: Good morning everybody.
• 10:58
  Speaker 1: The like freeloaders Thanks very much, david.
• 10:59
  Speaker 1: Appreciate that.
• 10:59
  Speaker 1: Good morning, everybody and the money printers are going to come back on.
• 11:01
  Speaker 1: Yes, danzo, in fact, they are already back on.
• 11:02
  Speaker 1: Slowly but gradually, we're going to get basically more money all over the world, because lower interest rates and more supportive policies by central banks mean well, stuff goes up.
• 11:15
  Speaker 1: And that's also why we're talking a little bit more about cryptos and Coinbase the last few days and stuff like that, because I think those things benefit from what?
• 11:25
  Speaker 1: Money printing?
• 11:26
  Speaker 1: It's very, very simple, right?
• 11:29
  Speaker 1: Biden doesn't look like he can live another five years.
• 11:31
  Speaker 1: Oh, I think he'd be perfectly happy on a porch and a rocking chair, don't you think?
• 11:34
  Speaker 1: Porch and a rocking chair, don't you think?
• 11:39
  Speaker 1: With a little cat on his lap?
• 11:39
  Speaker 1: I mean, I think I'd be quite happy there.
• 11:40
  Speaker 1: Hello Winstonians, logan, yeah, we still need to make the merch, don't we?
• 11:42
  Speaker 1: I do love maple syrup.
• 11:47
  Speaker 1: Aruna, that is one of the more random statements you've made on this channel.
• 11:53
  Speaker 1: Low interest rates will be good for a new stock.
• 11:54
  Speaker 1: Well, it'll be good for pretty much everything.
• 11:57
  Speaker 1: I mean, iwm is coming alive a little bit here.
• 12:01
  Speaker 1: Right, gap up yesterday, not a big one, but a little bit of that, and you know we're bullish mid-caps.
• 12:08
  Speaker 1: Another way to play that would be IWO, which is the growth stocks which also did well, small caps.
• 12:13
  Speaker 1: But there's no options on IWO, so we're sticking to iwm.
• 12:20
  Speaker 1: And if we want to look at some of our favorite tech stocks, palantir can't stop going up at 2786 pre-market, which looks pretty good so far.
• 12:29
  Speaker 1: Yeah, fintechs aren't going anywhere.
• 12:31
  Speaker 1: I've been keep saying that they're not going anywhere.
• 12:33
  Speaker 1: People keep still keep being surprised by it.
• 12:36
  Speaker 1: Pay PayPal is the same story.
• 12:38
  Speaker 1: They will benefit from rate cuts.
• 12:39
  Speaker 1: You see the red zone we painted in here.
• 12:43
  Speaker 1: It's been there for a while and it's actually kind of bullish down here.
• 12:47
  Speaker 1: Maybe we should nibble a little bit more from PayPal.
• 12:50
  Speaker 1: Might be an idea.