Latest / Felix Nikolas Prehn's Podcast / Is This The Beginning Of A New Stock Rally? + Stock Market News 28 March 2024

Transcript

Is This The Beginning Of A New Stock Rally? + Stock Market News 28 March 2024 · Felix Nikolas Prehn's Podcast

• 0:00
  Speaker 1: Good morning to you, to this glorious investing and trading day, the last day before Easter.
• 0:07
  Speaker 1: I hope you're going to enjoy your lovely long holiday.
• 0:10
  Speaker 1: We've got plenty to get through, though.
• 0:12
  Speaker 1: We've got a very, very bullish market view out today, and I want to walk you through that what that means, as well as where NVIDIA is heading and all the major stocks.
• 0:23
  Speaker 1: We've got some real insider trades.
• 0:26
  Speaker 1: I want to show you on Arm, which is kind of a nice indicator, as well as answer all your questions.
• 0:34
  Speaker 1: Put your questions in the chat and we'll run through them all, but let's get cracking.
• 0:39
  Speaker 1: We've also got jobs data out and GDP data out and all that kind of good stuff, but let's get on to that in a moment.
• 0:45
  Speaker 1: Market isn't open yet, so we've got a little bit of time to just understand this and make you the best informed investor out there so you can make more money.
• 0:53
  Speaker 1: That's what this is all about.
• 0:54
  Speaker 1: This is not financial advice.
• 0:56
  Speaker 1: Of course, this is prepared by my cat, so do with it as you wish.
• 1:01
  Speaker 1: Make this the beginning of your research, not the end.
• 1:04
  Speaker 1: Now we've got from HSBC out a very, very bullish scenario on stocks, and I kind of see the logic in what they're saying.
• 1:16
  Speaker 1: They're basically saying that AI is going to solve everything, cure cancer and give you competent leaders.
• 1:23
  Speaker 1: They're not quite, but they're basically saying that the adoption of AI is going to drive productivity because people can do more with it than they can currently do.
• 1:35
  Speaker 1: It means you can do more with less stuff and therefore your profits go higher.
• 1:41
  Speaker 1: And they're essentially modeling the S&P 500 earnings per share, which, in the long run, is what matters.
• 1:47
  Speaker 1: And they're saying look, if we get fast adoption, we get 7.5% annual growth on earnings per share, which is insane.
• 2:00
  Speaker 1: And that would take the S&P, or that would mean the S&P should be worth 5,900 points.
• 2:09
  Speaker 1: Right now you might be thinking whoa, whoa, right, that's quite nice, isn't it?
• 2:14
  Speaker 1: And if it's a little bit slower, their worst case scenario it's still an extra almost 6% growth on top of what we were about to expect.
• 2:24
  Speaker 1: So if these peanut counters are right, then we're in for a glorious decade of investing.
• 2:32
  Speaker 1: I think we're in for a glorious decade of investing anyway, because I think we can make money in all scenarios.
• 2:37
  Speaker 1: But that's a different story we can obviously get into in just a moment.
• 2:41
  Speaker 1: Get into in just a moment.
• 2:43
  Speaker 1: Now, the AI mentions per 100,000 sentences is through the roof.
• 2:50
  Speaker 1: That doesn't necessarily mean that much, obviously, but it is something that's going to stick around.
• 2:56
  Speaker 1: It's a little bit like com in 1999, except this is actually going to deliver value faster, I think, than a lot of people are expecting, although the tail end of AI, I think, is probably where the real value lies.
• 3:10
  Speaker 1: So I'm a little bit.
• 3:11
  Speaker 1: I'm kind of happy on both sides of that, morgan Stanley also saying that the cost of AI compute power.
• 3:19
  Speaker 1: So they're basically saying, look, chips are actually getting massively cheaper because they're getting massively more powerful.
• 3:24
  Speaker 1: Saying, look, chips are actually getting massively cheaper because they're getting massively more powerful, and that again allows companies to use more and more and more computing power, as in more and more and more AI, which will again drive the profitability push from AI.
• 3:38
  Speaker 1: So it's a real thing.
• 3:39
  Speaker 1: It's not some sort of like oh let's.
• 3:42
  Speaker 1: You know, the thing with com was okay, com's here, the internet's here, let's build Facebook.
• 3:49
  Speaker 1: But nobody could figure out how they were ever going to make money right, advertising online didn't exist, so it was very much a sort of pie in the sky let's hope it turns out well kind of a thing, which is why 90% of those companies went bust, whereas here you're like I've got a problem, but I can fix it today.
• 4:06
  Speaker 1: I can make stuff better and more efficient today, and that's, I think, the real difference here, and that's also why funds are massively overexposed to it right now.
• 4:17
  Speaker 1: And you could say, well, maybe that's the top of the market.
• 4:20
  Speaker 1: Well, let me show you what's going on with ARM, because they obviously also build chips, sort of a little bit competing with NVIDIA.
• 4:31
  Speaker 1: There In Europe, the fund managers have virtually no cash.
• 4:33
  Speaker 1: They're just kind of fully invested, which is bonkers.
• 4:34
  Speaker 1: If you are in European stocks, by the way, for our European friends, you're late, or at least if you're getting into it now, you're late.
• 4:42
  Speaker 1: You're late to the party.
• 4:43
  Speaker 1: So I would not be buying European stocks right now, perhaps with a couple of exceptions, and that's because the the bull run is essentially at 1999 or 1998 levels and we haven't seen anything like that in 25 years.
• 5:00
  Speaker 1: So be cautious when you see those headlines about how Europe is going to be the next big thing or something.
• 5:05
  Speaker 1: No, that headline is six months too late.
• 5:07
  Speaker 1: Small caps are still crap.
• 5:14
  Speaker 1: Yep, we kind of know that, basically, small caps are not making money.
• 5:18
  Speaker 1: That's why the IWM, the Russell, is down, and then we kind of know that, basically small caps not making money.
• 5:19
  Speaker 1: That's why the IWM, the Russell, is down.
• 5:22
  Speaker 1: And then we've got Nvidia here and look at that lovely chart.
• 5:25
  Speaker 1: Right, it's basically almost vertically up, only beaten by Cocor, and it just needs to hold this level here at sort of 880, basically, if it holds 880 and it keeps going up, we're all good.
• 5:39
  Speaker 1: If not, we might be in for a little bit of a correction.
• 5:42
  Speaker 1: And are we going to get a correction?
• 5:45
  Speaker 1: Well, there is an indicator called fractional dimension and you can look.
• 5:56
  Speaker 1: It has a 66% probability of saying we're going to get a correction here.
• 6:06
  Speaker 1: So say, it collapsed here and then we got this correction down here.
• 6:11
  Speaker 1: It collapsed here as well, rebounded a little bit.
• 6:16
  Speaker 1: Now it's collapsing again.
• 6:17
  Speaker 1: So we just did a little bit.
• 6:18
  Speaker 1: Now it's collapsing again.
• 6:18
  Speaker 1: So we just did a little bit of sideways trend there.
• 6:20
  Speaker 1: When it collapsed in 2019 in similar fashion, we got a bit of a correction.
• 6:25
  Speaker 1: It's not 100%, it's 66%, but it's basically saying we need NVIDIA to buy some more call options, which is what they've been doing.
• 6:35
  Speaker 1: By the way, I'm going to put out a video on that later today, how NVIDIA props up its share price.
• 6:40
  Speaker 1: It's not illegal, it's not dodgy, it's just not really kosher.
• 6:46
  Speaker 1: But I'll explain that to you on a video a little bit later today.
• 6:51
  Speaker 1: Now let me show you something I just posted on X, which is this this is a short little clip from OptionsWatchio, which is a software we built, and this is a better version of a feature called Smart Money Trades.
• 7:05
  Speaker 1: We can see the trades that the big boys do and we can see they're all selling calls.
• 7:12
  Speaker 1: I mean massive amounts, like 20,.
• 7:15
  Speaker 1: I mean dozens of millions of dollars all yesterday.
• 7:18
  Speaker 1: And what does that mean?
• 7:19
  Speaker 1: If you're selling calls, it means you're bearish, right, it means you think the stock's going to drop.
• 7:24
  Speaker 1: But you then use the second feature of options watch and you look up the previous positioning.
• 7:31
  Speaker 1: You can actually see they're taking profits.
• 7:33
  Speaker 1: So it's not quite the same thing.
• 7:35
  Speaker 1: So it's not like oh my God, arm is over.
• 7:39
  Speaker 1: They're basically just saying let me pull it up for you.
• 7:42
  Speaker 1: Here it is.
• 7:43
  Speaker 1: They're basically just saying these are all the trades that they put out and these are all into 2026.
• 7:49
  Speaker 1: Massive amounts of trades down, call options down here in the 70s and 80s and they would have made a shitload of money on those.
• 7:56
  Speaker 1: So they're closing those trades and they would have made a shitload of money on those.
• 7:59
  Speaker 1: So they're closing those trades.
• 8:00
  Speaker 1: So they're just saying we're happy We've hit a profit target and that's a good thing to do.
• 8:02
  Speaker 1: I'd encourage you to do the same thing if you're putting on trades.
• 8:06
  Speaker 1: But it also is sort of calling.
• 8:07
  Speaker 1: It's kind of calling the top right.
• 8:09
  Speaker 1: They're saying I think this is about it.
• 8:13
  Speaker 1: So that's kind of an interesting one.
• 8:15
  Speaker 1: There's another one, actually, which I put out just on SoFi the first big trade I've seen in a really long time.
• 8:21
  Speaker 1: Again, this is from optionswatchio $1.1 million spent on a call option yesterday.
• 8:27
  Speaker 1: It's the single, the only large trade out there and that's into January 2026.
• 8:33
  Speaker 1: So basically, somebody putting on kind of the same trade that I put on a couple of weeks ago, which is reassuring if you are me or maybe just another person who's as crazy as me.
• 8:43
  Speaker 1: So again, don't put these traits on if you don't understand them and all that kind of stuff.
• 8:47
  Speaker 1: But it's interesting to be able to get your hands on that data, wouldn't you say?
• 8:50
  Speaker 1: I certainly think it is.
• 8:51
  Speaker 1: So if you want to get your hands on that data, grab yourself a free one month trial of optionsWatchio.
• 8:56
  Speaker 1: We're going to release this feature publicly next week, I think, and you will then get free access to that for that month.
• 9:04
  Speaker 1: So check it out Now.
• 9:11
  Speaker 1: Good morning, good morning, italians are always late.
• 9:14
  Speaker 1: I'm sure that's racist, danzo, very, very racist.
• 9:17
  Speaker 1: So should we look at the economic data, or would you rather not know?
• 9:22
  Speaker 1: Would you rather not know?
• 9:23
  Speaker 1: I mean, sometimes not knowing is a peaceful place to be right.
• 9:28
  Speaker 1: Ignorance is a great defense in life.
• 9:32
  Speaker 1: I'm like well, I'm not worried about it, I don't know anything about it, but let's have a look then let's have a look, and let's have a look, then let's have a look and let's colour code this as if we're six.
• 9:41
  Speaker 1: So green is good.
• 9:42
  Speaker 1: Gdp growth was revised upwards and Now is that good or bad?
• 9:47
  Speaker 1: Well, you'd think it's good, right, initially, soft landing, miracle and all of that.
• 9:54
  Speaker 1: Jobless claims are flat.
• 9:57
  Speaker 1: That's good.
• 9:58
  Speaker 1: No, surprises are great for the market.
• 10:02
  Speaker 1: Core PCE is a little lower than expected.
• 10:06
  Speaker 1: It's been revised downwards, undoubtedly by some Biden pencil pusher.
• 10:10
  Speaker 1: Jobless claims for weeks.
• 10:14
  Speaker 1: It's also flat.
• 10:14
  Speaker 1: No, pce prices exactly as expected.
• 10:17
  Speaker 1: Consumer spending revised up.
• 10:20
  Speaker 1: Who would have thought but yeah, it's all good, isn't it?
• 10:22
  Speaker 1: It's all good.
• 10:24
  Speaker 1: Corporate profits higher than expected.
• 10:27
  Speaker 1: Let the party go on.
• 10:29
  Speaker 1: Let the booze-filled parties continue.
• 10:35
  Speaker 1: Premarket.
• 10:35
  Speaker 1: We're looking okay, nothing super exciting.
• 10:39
  Speaker 1: Tesla down a touch and video and Apple down a little bit.
• 10:41
  Speaker 1: We don't want those guys to go down too much.
• 10:44
  Speaker 1: Obviously.
• 10:45
  Speaker 1: Meta, google, microsoft, amazon slightly in the green Bank's down just a touch.
• 10:50
  Speaker 1: Here you got any big movers, any really big movers?
• 10:53
  Speaker 1: No, and you know why not.
• 10:56
  Speaker 1: It's Easter, almost Easter.
• 10:58
  Speaker 1: Everyone's far too busy trying to figure out how they can afford chocolate over the Easter holidays.
• 11:03
  Speaker 1: Because cocoa my friend is cocoa has gone up like pretty much nothing else.
• 11:11
  Speaker 1: This is the Cocoa chart.
• 11:13
  Speaker 1: Cocoa in well, what about last year?
• 11:18
  Speaker 1: Last year, easter Cocoa was at 2,600.
• 11:23
  Speaker 1: It's gone up more than three times since then.
• 11:26
  Speaker 1: So what you should expect is that the chocolate you're buying 261% up, will have less chocolate in it.
• 11:31
  Speaker 1: It will have fluffy additives in it.
• 11:35
  Speaker 1: Very little chocolate, probably, at least if you're buying the cheap stuff.
• 11:38
  Speaker 1: Belgium is present already a future of buyer.
• 11:49
  Speaker 1: Hello from South Korea.
• 11:50
  Speaker 1: Hello there, brandon.
• 11:52
  Speaker 1: Don't forget egg prices, lind.
• 12:00
  Speaker 1: Well, there shouldn't be any egg in your chocolate.
• 12:02
  Speaker 1: It's real chocolate.
• 12:06
  Speaker 1: Let's talk about IBM.
• 12:06
  Speaker 1: Is a long call, should we IBM?
• 12:09
  Speaker 1: I actually did a video on IBM the other day.
• 12:12
  Speaker 1: It's actually looking quite good.
• 12:13
  Speaker 1: Yeah, look at that.
• 12:14
  Speaker 1: This is a week's chart.
• 12:15
  Speaker 1: But yeah, actually looks pretty good.
• 12:16
  Speaker 1: Had a very, very nice run.
• 12:17
  Speaker 1: But yeah, the economic data is good, projections are good, ai is alive.
• 12:22
  Speaker 1: The world's a beautiful place.
• 12:24
  Speaker 1: Let's have a look at the US edition of Bloomberg.
• 12:27
  Speaker 1: Edition of Bloomberg SPF.
• 12:28
  Speaker 1: Prison time hangs on.
• 12:29
  Speaker 1: Persuading judge.
• 12:30
  Speaker 1: He's no Bernie Madoff.
• 12:31
  Speaker 1: 40 to 50 years.
• 12:33
  Speaker 1: What do you think about that?
• 12:34
  Speaker 1: Do you think he deserves 40 to 50 years in jail?
• 12:36
  Speaker 1: Didn't murder anyone, did he?
• 12:47
  Speaker 1: I mean, yeah, he was an infantile idiot with a stroke of genius who ran a $50 billion crypto portfolio in QuickBooks.
• 12:50
  Speaker 1: But is that 40 to 50 years in jail?
• 12:53
  Speaker 1: I mean, rapists don't get 40 to 50 years in jail, do they?
• 12:56
  Speaker 1: I sometimes think the sentencing thing is a little off.
• 12:59
  Speaker 1: I mean, that chap there behind him, I wouldn't mind putting him into jail for 40 or 50 years.
• 13:04
  Speaker 1: I'm sure there is good reason for that, but this guy just looks a little bit like I'm a tech nerd.
• 13:10
  Speaker 1: I got carried away.
• 13:11
  Speaker 1: What can I say?