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Transcript

Felix Prehn - Warning: Banks Just Started to FOMO BUY EVERYTHING! + Stock Market News 07 November 2024 · Felix Nikolas Prehn's Podcast

• 0:00
  Speaker 1: Wall Street's most influential investment bank, goldman Sachs, just warned its big institutional clients that the market is about to enter a FOMO buying loop.
• 0:11
  Speaker 1: It's basically a massive short squeeze and hour ticket to get much, much wealthier.
• 0:19
  Speaker 1: I think it isn't just Goldman's big clients who deserve to understand this, but you and me, the retail investor.
• 0:24
  Speaker 1: So we're going to break down the five biggest flows that Goldman is tracking this morning, and that starts off with an unwinding of alleged hedges.
• 0:35
  Speaker 1: And don't worry, I'll break it down and make it simple.
• 0:37
  Speaker 1: Essentially, what happens before any big event that has a lot of uncertainty, wall Street buys, put options, which is insurance.
• 0:45
  Speaker 1: Just think of it that way Buy insurance.
• 0:47
  Speaker 1: When the big event, that is, the scary event that they're worried about, is then over, they close out of those positions, and that in itself tends to push the market up.
• 0:58
  Speaker 1: And you might have noticed this when we get big Fed meetings, interest rate decisions the day before the market's a bit wobbly, and straight after the meeting we tend to shoot up.
• 1:08
  Speaker 1: And that is exactly what's happening here with this unwinding of Wall Street's insurance positions.
• 1:14
  Speaker 1: At number two, we have the November.
• 1:17
  Speaker 1: Corporate demand is the strongest of the year.
• 1:21
  Speaker 1: What does that mean?
• 1:22
  Speaker 1: It's buybacks.
• 1:24
  Speaker 1: The month in which the most buybacks happen and I'll show you some charts here in a second is November, and that's going to drive a ton of money, and I'm going to tell you exactly how much money in a moment.
• 1:34
  Speaker 1: And what's the point of all of this, you might wonder?
• 1:37
  Speaker 1: The point is that you can spot big breakouts and make big profits on particular stocks and sectors, and you need to understand how to spot those, so you're not buying the duds, but you're buying the ones that are very likely going to go much, much higher.
• 1:56
  Speaker 1: Let me show you one on the screen here that I found in September.
• 1:59
  Speaker 1: It was FOA.
• 2:00
  Speaker 1: It's a stock I'd never heard of, didn't know what they do Finance of America, some sort of mortgage type business and we got a beautiful, beautiful breakout literally around here.
• 2:12
  Speaker 1: And what did I do?
• 2:14
  Speaker 1: Well, I bought the stock because my indicators all triggered, and you're going to learn what those indicators are.
• 2:20
  Speaker 1: Watch the masterclass Link is down below and you learn it completely for free.
• 2:23
  Speaker 1: But this trade that didn't do a lot for a while.
• 2:26
  Speaker 1: And then it's taking off and we are now up I don't know 60 odd percent or something.
• 2:32
  Speaker 1: I'll take a screenshot from the Webull account that I have with it and that's exactly what we want to find.
• 2:39
  Speaker 1: It's these trades, these opportunities exist most weeks.
• 2:43
  Speaker 1: You'll find a couple.
• 2:43
  Speaker 1: At the moment I think you're going to find a ton.
• 2:46
  Speaker 1: But you need to understand what makes this a really good setup.
• 2:50
  Speaker 1: This was a super clean setup and that's why it's doing well, and don't buy the ones that are like average or have got some massive resistance overhead.
• 2:58
  Speaker 1: So please, after this video, watch that free masterclass.
• 3:02
  Speaker 1: That's why I make it for you, so that more of us can make more money and I get more happy messages from happy people in the account, which is what makes me happy.
• 3:12
  Speaker 1: But let's just go back to the buybacks here for a moment.
• 3:15
  Speaker 1: November and December are the strongest two-month period of the year.
• 3:19
  Speaker 1: If you look at the charts, you know we're going to get some serious buying here from the companies themselves.
• 3:27
  Speaker 1: And at number three, a lot of the institutions took some heat off the stove, so to speak, before the election.
• 3:39
  Speaker 1: They were worried it might go the wrong way, so they just thought let's park some money on the sidelines and that way we'll be safe.
• 3:46
  Speaker 1: And what are they now going to do?
• 3:49
  Speaker 1: Well, at the moment, their positioning is at the lowest level since March 2023.
• 3:55
  Speaker 1: They are going to chase the fricking rally because they've got FOMO, because if they miss this two-month golden window till the end of the year, well, their bonuses are going to be smaller, and there's nothing that an investment banker loathes more than having a smaller bonus than his friend right Size matters on Wall Street, so they tell me, and then I'm going to show you a chart here which shows you where we are right now.
• 4:19
  Speaker 1: Seasonals follow certain dates and all we're waiting for is for the election to get out of the way.
• 4:26
  Speaker 1: Now it's out of the way.
• 4:27
  Speaker 1: The S&P historically goes up 2.6% from today to the end of the year.
• 4:35
  Speaker 1: It's done that since 1928, so the data is pretty good.
• 4:38
  Speaker 1: And that does not factor in a new president who's promising to slash taxes, slash regulation, reduce the size of the government, therefore reduce debt right and just completely overhaul the whole thing.
• 4:52
  Speaker 1: He's going to be very Wall Street and banking friendly.
• 4:55
  Speaker 1: He's going to be friendly for American companies oil and gas companies, like a lot of stuff that could pump a lot of money into US stocks.
• 5:06
  Speaker 1: So in an election year, typically it actually goes up by 3.3% from today to the end of the year.
• 5:12
  Speaker 1: But this is not your average election year.
• 5:14
  Speaker 1: This is a Trump election year and therefore I would imagine it'd be much, much bigger Now.
• 5:19
  Speaker 1: If you are a techie, a NASDAQ investor again, therefore, I would imagine it would be much, much bigger Now.
• 5:21
  Speaker 1: If you're a techie, a Nasdaq investor again, I'll show you the chart here.
• 5:24
  Speaker 1: The chart in an election year.
• 5:26
  Speaker 1: Well, normally the Nasdaq goes up 5.5% between now and the end of the year.
• 5:31
  Speaker 1: That's pretty good right Now.
• 5:33
  Speaker 1: In election years it actually hasn't been that good.
• 5:35
  Speaker 1: It was less than a percent, but I think that depends on who got elected.
• 5:41
  Speaker 1: I would imagine it's since 1985.
• 5:44
  Speaker 1: We'd have to have a look, if there is.
• 5:45
  Speaker 1: You know what the reason was for that.
• 5:47
  Speaker 1: But again, I think tech is going to broadly benefit.
• 5:51
  Speaker 1: Apple is the only one I'm worried about, because so much of their manufacturing is overseas.
• 5:56
  Speaker 1: What about small caps?
• 5:57
  Speaker 1: 5.7% from now until the end of the year is the average In an election year.
• 6:03
  Speaker 1: It's almost 8% from now to the end of the year.
• 6:06
  Speaker 1: Isn't that staggering?
• 6:07
  Speaker 1: And of course, iwm and all the leveraged Russell ETFs did tremendously well yesterday.
• 6:14
  Speaker 1: I'd stay away from that leverage if I were you, but that's just my conservative risk management there.
• 6:20
  Speaker 1: And then at number five, we again have something that few people understand.
• 6:24
  Speaker 1: So you have a thing called the VIX, and the VIX is the fear index.
• 6:30
  Speaker 1: Let me just pull it up here for you.
• 6:31
  Speaker 1: In trade vision, when the VIX goes down, there is less fear.
• 6:35
  Speaker 1: Then the algo funds, the computers, buy more, and so, basically, lower VIX.
• 6:43
  Speaker 1: Good, right, and VIX really crashed here about four points, which is about 20%.
• 6:51
  Speaker 1: So a 20% drop in the VIX will trigger some serious buying from the algo funds, which will drive the market up more and more and therefore more algo funds will buy and therefore more bankers and more funds and more investors will go.
• 7:06
  Speaker 1: I don't want to miss this rally.
• 7:07
  Speaker 1: I'm going to buy too.
• 7:08
  Speaker 1: So that brings us to FOMO.
• 7:10
  Speaker 1: Now you might be wondering well, how high can we go?
• 7:12
  Speaker 1: Well, let me show you the big indices.
• 7:15
  Speaker 1: So let's start with the S&P here, and this is in Trade Vision, which is a platform that we build to bring you quality data.
• 7:22
  Speaker 1: Right, the resistance on the S&P has now moved up to 6,000 points, so I would wager we're going to get that, and basically, between now and 6,000, there isn't really any resistance.
• 7:36
  Speaker 1: There is nothing here.
• 7:38
  Speaker 1: We've never been higher, so it's fantastic.
• 7:40
  Speaker 1: So I think we could end the year at 6,000 plus, especially if Trump comes out with a little bit more details on his economic plan and tax plan and so on and I suspect they're not going on a holiday, but they're going to really thrash out details now so they can get started with a force on the first day in office, which I believe is early January, isn't it?
• 8:02
  Speaker 1: You Americans can inform me on that one, when exactly the date is.
• 8:07
  Speaker 1: But yeah, given that Elon's involved, I don't think he's going to be like all right, let's go and play computer games.
• 8:12
  Speaker 1: He will be like let's make a freaking plan.
• 8:14
  Speaker 1: So on day one we can get everything done that we want to get done in the next four years.
• 8:18
  Speaker 1: So I think the S&P will hit 6,000 here.
• 8:29
  Speaker 1: If you look at Nasdaq, let me pull up the QQQ for you.
• 8:30
  Speaker 1: Where's the resistance?
• 8:30
  Speaker 1: We're above it.
• 8:31
  Speaker 1: It's at 500.
• 8:31
  Speaker 1: We're above it, so it's becoming less relevant.
• 8:33
  Speaker 1: The further you move away from the 500, the less important that becomes.
• 8:37
  Speaker 1: Because what happens at 500, market makers sell.
• 8:40
  Speaker 1: But if the demand is this strong, then you can out-resistant a resistance line.
• 8:48
  Speaker 1: So resistance lines basically tell you where the market makers positioned, where they're going to sell right.
• 8:53
  Speaker 1: You can get through it with some big, beautiful, shiny news.
• 8:58
  Speaker 1: Trade Vision called it a buy signal here yesterday and historically we've outperformed the buy and hold strategy by a factor of almost three.
• 9:08
  Speaker 1: So we've done rather well there.
• 9:10
  Speaker 1: Now any indicator, if you just use it without any risk management, will likely lose you money.
• 9:15
  Speaker 1: So please learn risk management at the same time.
• 9:17
  Speaker 1: But yeah, the signals, I definitely use them.
• 9:19
  Speaker 1: I find them very useful.
• 9:20
  Speaker 1: Again, you can try Trade Vision for a week for free.
• 9:23
  Speaker 1: There's a link down below.
• 9:24
  Speaker 1: But the big thing I think here that is just trying to drive us.
• 9:28
  Speaker 1: Without Trump, literally without any change in politics, we would have had this massive, massive buyback money coming in.
• 9:38
  Speaker 1: About 10% of the annual buyback spend will be spent in November.
• 9:43
  Speaker 1: That's about $100 billion just flowing in there and Goldman Sachs estimates $6 billion a day being bought every single day in November.
• 9:54
  Speaker 1: That's pretty significant, right, and there's a chart here which shows you how we dip down and then we massively are about to reaccelerate on that buyback demand.
• 10:04
  Speaker 1: So it will also drive the market more on those low liquidity days.
• 10:08
  Speaker 1: So later in the month, when you get into the Thanksgiving vacation period there and most of the bankers are in the Hamptons or Bahamas or somewhere.
• 10:16
  Speaker 1: There is literally less liquidity there, so the buybacks will still happen and those days might well pop, so that's definitely something to look out for.
• 10:24
  Speaker 1: So the year-end rally has started and I believe it's going to be bigger than most investors are expecting, so I am looking forward to a massive rotation into stocks.
• 10:38
  Speaker 1: I also think the bond markets are going to start rotating back into stocks and there is a lot of money in money market funds that could rotate back in here.
• 10:48
  Speaker 1: So, in short, I think this is a beautiful, beautiful setup.
• 10:53
  Speaker 1: Now you need to understand which are great breakouts which we want to buy and like the FOA one here, and which we're going to make us, you know, 60%, 100%, 150%, and then the ones where we're going to hit our head and we're going to make 3 percent and then lose 5 percent because of our stop loss.
• 11:10
  Speaker 1: So please do yourself a favor Watch the free masterclass.
• 11:15
  Speaker 1: You will literally learn the rules on how to spot the breakouts, because you deserve to know it, and it's breakout season, my friend, so thank you for tuning in.
• 11:25
  Speaker 1: If you got some value out of this, share the video with a friend or a golden retriever on Twitter or wherever you share things, and I wish you a very, very profitable ride into the end of the year and get smarter and get better at making that money work for you so life can be better.
• 11:42
  Speaker 1: All the best.