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Transcript

Felix Prehn - (Still) The Best Investing Opportunity This Decade + Stock Market News 21 August 2024 · Felix Nikolas Prehn's Podcast

• 0:00
  Speaker 1: This pre-market live stream.
• 0:01
  Speaker 1: It is a beautiful, wonderful sunny day, no matter what the weather says outside.
• 0:06
  Speaker 1: That's the temperature and the market, and I want to explain that to you.
• 0:10
  Speaker 1: We're going to get two enormous pieces of data today and it is important to understand what those are.
• 0:16
  Speaker 1: And we got a really, really important data point added to our bull case scenario.
• 0:23
  Speaker 1: Now is that good or is that bad?
• 0:25
  Speaker 1: Well, I'll leave that to you to judge.
• 0:26
  Speaker 1: I'll walk you through it and I'll teach you exactly what that means.
• 0:30
  Speaker 1: Mark, welcome to the community.
• 0:33
  Speaker 1: Very happy to see you on the inside.
• 0:35
  Speaker 1: I will be.
• 0:37
  Speaker 1: I'll do some live trading next week as well, so you can get a bit of a flair for what I do and how I do it.
• 0:42
  Speaker 1: But to start with, mark, paper trade, paper trade, paper trade.
• 0:50
  Speaker 1: I say that to every single one of my students because that's how you make money without losing money.
• 0:53
  Speaker 1: So let me jump straight into it.
• 0:54
  Speaker 1: We're getting today, at 10 am, in literally 58 minutes, non-farm payroll annual revisions, which I'm sure is what you all talked about over your breakfast cereal this morning, isn't it?
• 1:07
  Speaker 1: Isn't that what you said, children?
• 1:09
  Speaker 1: Today is a big day.
• 1:10
  Speaker 1: Non-farm payrolls, annual revisions are out.
• 1:12
  Speaker 1: Why is that a big deal, because we're expecting them to be horrible.
• 1:19
  Speaker 1: We're expecting the government to say I'm sorry, we lied, and I think we fabricated at least a million jobs, so we're expecting that, to say about 1 million jobs were simply a fabrication of this administration.
• 1:38
  Speaker 1: I'm sure they did it out of the goodness of their heart and it was a complete, you know, oversight and that sort of thing.
• 1:44
  Speaker 1: No ill intentions there.
• 1:45
  Speaker 1: No, not trying to manipulate you.
• 1:47
  Speaker 1: They would never do that.
• 1:48
  Speaker 1: That's Tenia.
• 1:49
  Speaker 1: And then at 2 pm, it gets even more exciting.
• 1:51
  Speaker 1: We get the FOMC minutes, which is the minutes from the last Fed meeting, which is riveting reading, and we're hoping they're going to start to say a little bit stuff.
• 2:00
  Speaker 1: I actually don't think this matters.
• 2:03
  Speaker 1: I would actually argue this is not important, and I'll tell you why Because the Fed chair, jerome LePowell, is speaking on Friday and we're therefore all waiting what he's going to say on Friday, rather than what the minutes from the meeting a month ago had to say.
• 2:21
  Speaker 1: We don't care that much because we're going to hear it straight from the horse's mouth on Friday.
• 2:25
  Speaker 1: But the non-farm payrolls thing matters.
• 2:27
  Speaker 1: And how does that matter?
• 2:29
  Speaker 1: Well, these are revisions from each of the last five years and 2019, we had a pretty big revision.
• 2:41
  Speaker 1: In 2022, we found an extra 460,000 jobs.
• 2:46
  Speaker 1: 2023, we destroyed 300,000.
• 2:49
  Speaker 1: This year could be the biggest one ever, with minus a million jobs.
• 2:53
  Speaker 1: Why does it matter?
• 2:54
  Speaker 1: Well, if this figure comes in, larger than the same million figures Goldman Sachs, the bankers with the big, warm, fuzzy heart they're saying they're all about adopting kittens and that kind of thing.
• 3:07
  Speaker 1: They're saying somewhere between 600,000 to a million jobs were fabricated.
• 3:11
  Speaker 1: But what if this thing comes in at, say, 1.1 million jobs were fabricated.
• 3:17
  Speaker 1: Do we, at that moment, freak out and say recession or are we still happy with that?
• 3:23
  Speaker 1: That's the risk with today's data A million, we can handle bigger than a million.
• 3:29
  Speaker 1: And you better put your big boy pants on, especially if you're in consumer stocks, because that could turn a little ugly.
• 3:34
  Speaker 1: So that's a little warning here.
• 3:37
  Speaker 1: But the market, it's just going up and up and up and up and up.
• 3:41
  Speaker 1: It's very rare we get daily increases in the S&P consistently.
• 3:49
  Speaker 1: It just doesn't happen.
• 3:50
  Speaker 1: Right now, we've had eight days in a row of the S&P going up.
• 3:56
  Speaker 1: That's exceptionally rare.
• 3:58
  Speaker 1: You see how rare that is.
• 3:59
  Speaker 1: The market zigs and zags, which is why traders make money Very, very rare.
• 4:03
  Speaker 1: It continues to go up in a straight line.
• 4:05
  Speaker 1: So you've got to expect some point, a little bit of a mini dip, nothing significant, but something right.
• 4:12
  Speaker 1: Philco recession Now.
• 4:18
  Speaker 1: So, now that I've prepared you for that, here's a beautiful chart.
• 4:21
  Speaker 1: What does this say?
• 4:22
  Speaker 1: This is the VIX, this is the fear index, and it's dropped just by the second largest amount in the history of fear.
• 4:35
  Speaker 1: The biggest one was somewhere here, I don't know when.
• 4:39
  Speaker 1: That was 2018 or something.
• 4:41
  Speaker 1: What does that mean?
• 4:42
  Speaker 1: It means we're in.
• 4:43
  Speaker 1: La la la.
• 4:44
  Speaker 1: Everything is perfect.
• 4:45
  Speaker 1: Everything is wonderful.
• 4:46
  Speaker 1: Either everybody is on some sort of substance or maybe the world is actually wonderful.
• 4:50
  Speaker 1: You guys still getting ads, bastards.
• 4:53
  Speaker 1: They're not paying us for it.
• 4:55
  Speaker 1: Google is pocketing all their profits, but you know what?
• 4:59
  Speaker 1: Don't worry about us too much, because we're making money.
• 5:03
  Speaker 1: We're going to continue to make money.
• 5:04
  Speaker 1: This is our teaching portfolio, right?
• 5:06
  Speaker 1: $30,000 is our teaching portfolio.
• 5:09
  Speaker 1: It's up by $25,000.
• 5:12
  Speaker 1: And if you want to see something even more beautiful, these are our only current trades open.
• 5:18
  Speaker 1: There's another $7,300 of profits.
• 5:21
  Speaker 1: Just sitting there.
• 5:21
  Speaker 1: I could close it out, but it's too good a run to miss out on stuff.
• 5:25
  Speaker 1: So if you add the $7,000 on top and we don't, because I don't count unrealized profits, we'd be at $32k up on a $30k portfolio.
• 5:33
  Speaker 1: So I think it's fair to say that we're doing something right.
• 5:36
  Speaker 1: I'm never promising returns, by the way, but I think it's fair to say we're doing something right.
• 5:40
  Speaker 1: If you want to learn how we're doing something right, join that workshop next week Links down below in the description.
• 5:48
  Speaker 1: I'll give it away because it's fun.
• 5:51
  Speaker 1: I enjoy it.
• 5:52
  Speaker 1: Honestly, it's really, really fun.
• 5:55
  Speaker 1: It's fun to see people doing well, because they learned something that they should have been taught in school.
• 5:59
  Speaker 1: It's really, really fun to see.
• 6:01
  Speaker 1: But let's walk through the reasons why we are bullish and what might change this scenario here.
• 6:08
  Speaker 1: Jay, you're getting ads with premium, seriously Okay, you should throw a rock in the direction of Google, although if you go in Google stock, maybe you'd like it.
• 6:18
  Speaker 1: Maybe that's the way to do it Save the money on premium and just buy Google stock instead.
• 6:23
  Speaker 1: Buybacks are an absolute monster this year and we are in the biggest buyback window in the history of buybacks.
• 6:32
  Speaker 1: Basically, companies buy their own shares because they don't know what else to do with that or that money.
• 6:36
  Speaker 1: That is very, very bullish, right.
• 6:38
  Speaker 1: So that's item numero uno.
• 6:41
  Speaker 1: So one is buybacksbacks and we got a new one today.
• 6:47
  Speaker 1: Number two do is low liquidity.
• 6:51
  Speaker 1: It's basically the holiday fever, or you could say no one wants to sell.
• 7:02
  Speaker 1: And if you look at a stock chart, see if I can find one here's pre-market, by the way.
• 7:08
  Speaker 1: But and here's PayPal.
• 7:09
  Speaker 1: Look at that, right.
• 7:10
  Speaker 1: Finally, as PayPal hodlers are looking pretty smug, aren't we?
• 7:15
  Speaker 1: If you look at the S&P, look at that rally Like who wants to sell that rally Like, from a chart point of view, it just looks like okay, maybe you're not in it yet, maybe it's a little late because you're near that top here, but why would anybody sell until we at least hit our head at 564?
• 7:33
  Speaker 1: It doesn't really make any sense.
• 7:34
  Speaker 1: So that looks pretty good, right?
• 7:36
  Speaker 1: Nobody is selling.
• 7:37
  Speaker 1: You know, diamond hands, as they said in the good old COVID days.
• 7:42
  Speaker 1: And what is item number three?
• 7:45
  Speaker 1: It is anybody, anybody, anybody.
• 7:47
  Speaker 1: Pension funds.
• 7:49
  Speaker 1: Pension funds are doing what at the end of this month?
• 7:53
  Speaker 1: They are selling anyone Bonds and they're buying Anyone Stocks.
• 8:02
  Speaker 1: How much?
• 8:03
  Speaker 1: How much?
• 8:05
  Speaker 1: Does anybody know?
• 8:06
  Speaker 1: Anyone paying attention around here?
• 8:07
  Speaker 1: We estimate 40 billion.
• 8:10
  Speaker 1: That's pretty sweet, right?
• 8:11
  Speaker 1: I'm gonna have to shove some of the stuff down here because we need more space.
• 8:16
  Speaker 1: There are more reasons to be bullish than we have space for on our blackboard here.
• 8:21
  Speaker 1: And what is reason number four to be bullish?
• 8:25
  Speaker 1: Anyone, anyone at all, anyone.
• 8:27
  Speaker 1: Algo funds, so funds that are run by algorithms computers the dumb computers are buying in the coming week about 80 billion In the coming week.
• 8:41
  Speaker 1: That's pretty positive.
• 8:43
  Speaker 1: What else have we got?
• 8:46
  Speaker 1: Probably the hardest concept to understand market makers.
• 8:49
  Speaker 1: These are the lovely people and I call them lovely because we've got three of them on our team who basically are on the other side of your trade.
• 8:58
  Speaker 1: They provide market liquidity, if you'd like to say.
• 9:00
  Speaker 1: As you set up a trade, there's likely a market maker on the other side and he hedges his position so he has zero risk and he makes a little bit of money out of that bid-ask spread.
• 9:09
  Speaker 1: That's basically his living.
• 9:11
  Speaker 1: He's a classic trader.
• 9:13
  Speaker 1: And what happens if the market goes down right now?
• 9:16
  Speaker 1: So let me show you If we drop.
• 9:19
  Speaker 1: So let me show you If we drop, the market makers have to buy.
• 9:29
  Speaker 1: Now what happens if we go up?
• 9:30
  Speaker 1: The market makers sell.
• 9:33
  Speaker 1: Why is that a good thing?
• 9:35
  Speaker 1: It provides stability.
• 9:36
  Speaker 1: You see, it means the market is sort of doing something gradually and slowly and in a wonderfully predictable manner, hopefully until Jerome opens his mouth and it means fear is collapsing, as we saw on the chart here, right, fear is just coming down and coming down and coming down some more, and that's what happens when you are in this sweet spot where you get stability from all these market setups.
• 10:08
  Speaker 1: So we've got five reasons to be bullish buybacks.
• 10:11
  Speaker 1: Nobody's selling, pension funds got to buy, algo funds have to buy and market makers are basically supporting the status quo.
• 10:20
  Speaker 1: So that's pretty good, right?
• 10:22
  Speaker 1: Tyler thinks market makers are horrible.
• 10:24
  Speaker 1: It's a job.
• 10:25
  Speaker 1: Honestly.
• 10:26
  Speaker 1: They I don't think they're really the bad people out there.
• 10:28
  Speaker 1: They're just like part of what makes the market.
• 10:31
  Speaker 1: Um, I think the people who are like buying your data, for example, the sort of Citadels like, say, you trade on Robinhood, your data gets sold to Citadel and they can front run that.
• 10:41
  Speaker 1: I think that's not ideal, but I think the market makers actually are a little bit misunderstood.
• 10:47
  Speaker 1: Anyway, the three we've got on our team are lovely, so we need the data gamma.
• 10:55
  Speaker 1: Flipping points SJ.
• 10:56
  Speaker 1: Yeah, we're working on that.
• 10:56
  Speaker 1: We're working on that, my lovely.
• 10:57
  Speaker 1: So we need to do that.
• 10:58
  Speaker 1: I got my flipping points, sj.
• 10:58
  Speaker 1: Yeah, we're working on that.
• 10:59
  Speaker 1: We're working on that, my friend.
• 11:00
  Speaker 1: It's going to come, but it's a work in progress.
• 11:03
  Speaker 1: That's why I'd say, and the buybacks on PayPal, absolutely.
• 11:09
  Speaker 1: That's a good thing too.
• 11:10
  Speaker 1: And if you subscribe to Trade Vision, which is what I just showed you, these will be flagged yesterday as uptrend stocks, which is kind of handy because it means you don't need to run through 2000 stocks, you just like get an email twice a day.
• 11:23
  Speaker 1: So PayPal made the list.
• 11:25
  Speaker 1: Finally, cha-ching Fat drugs are up.
• 11:27
  Speaker 1: Church and Dwight Clorox what is that?
• 11:30
  Speaker 1: Monkeypox rally Is that what it is?
• 11:32
  Speaker 1: Clorox?
• 11:32
  Speaker 1: That Epox Rally is that what it is?
• 11:33
  Speaker 1: Clorox?
• 11:33
  Speaker 1: That's up.
• 11:34
  Speaker 1: And look at more good news Bitcoin.
• 11:46
  Speaker 1: I drew on this, didn't I?
• 11:47
  Speaker 1: Bitcoin is possibly going to get squeezed, and I can't be bothered to explain why, because I barely understand it, but it's apparently so crowded that it's likely that we might get a short squeeze.
• 11:53
  Speaker 1: Typically, typically, it's done that when we are in this particular setup.
• 11:57
  Speaker 1: So that's quite nice.
• 11:58
  Speaker 1: Um, I have a clsk trade open and I'm not suggesting that you do the same thing, but that's a.
• 12:03
  Speaker 1: That's the one way to get, to get um exposure.
• 12:07
  Speaker 1: Ryan says do we have a discord?
• 12:09
  Speaker 1: You know what?
• 12:09
  Speaker 1: We closed our discord, ryan.
• 12:11
  Speaker 1: You know why?
• 12:11
  Speaker 1: It was full of, like just scammers and con artists and all sorts of horrible people.
• 12:16
  Speaker 1: So we actually closed that and we just have a community now for coaching students which is completely private, so nobody can get into it unless they're actually part of it, because I really hate it when people go out there and try to scam our community.
• 12:28
  Speaker 1: So, yeah, we actually closed it for that reason quite a long time ago.