Latest / Felix Nikolas Prehn's Podcast / Felix Prehn - You Won’t Believe What Jerome Powell JUST Said…+ Stock Market News 01 October 2024

Transcript

Felix Prehn - You Won’t Believe What Jerome Powell JUST Said…+ Stock Market News 01 October 2024 · Felix Nikolas Prehn's Podcast

• 0:00
  Speaker 1: Felix here.
• 0:00
  Speaker 1: What is it exactly that Jerome Powell said yesterday that massively shifted the market at 2pm and has completely changed the expectations until year end?
• 0:10
  Speaker 1: I want to make sure you fully understand that, as well as a couple of other super important points that will influence the markets going into this glorious October an election October, which typically means it's a very, very choppy month.
• 0:23
  Speaker 1: So a few warnings, a trade idea at the end and hopefully, a ton of value.
• 0:28
  Speaker 1: So stick around, smash the you know what and let's go straight into it.
• 0:32
  Speaker 1: I'm super excited that our project that we've been working on for like a year and a half plus about 10 years before that me on my own which is called Trends AI it's an indicator that is tremendously outperforming.
• 0:46
  Speaker 1: Buy and hold across a lot of major stocks, the S&P and everything else.
• 0:51
  Speaker 1: Say, meta, if you bought that at the beginning of 2022, you'd be up 49%.
• 0:55
  Speaker 1: Right, we're up 175%.
• 0:56
  Speaker 1: Tesla, you'd be down 44%.
• 0:58
  Speaker 1: I know it sucks being a long-term Tesla shareholder these last two years.
• 1:01
  Speaker 1: We would be up 81%, and so on.
• 1:03
  Speaker 1: You can get an idea of just how big the outperformance is that we're seeing Even NVIDIA we're managing to beat, which is pretty cool.
• 1:11
  Speaker 1: So, of course, this is just an indicator.
• 1:13
  Speaker 1: This is not financial advice.
• 1:14
  Speaker 1: You still need a strategy and risk management and everything else.
• 1:17
  Speaker 1: But if you want to check this out and I'll show you a couple of trade ideas on this in a moment as well go trade ideas on this in a moment as well.
• 1:23
  Speaker 1: Go to tradevisionio and grab yourself a week's trial account and just play with it If you like it.
• 1:27
  Speaker 1: You like it, you stick around.
• 1:28
  Speaker 1: If you don't, you cancel it.
• 1:29
  Speaker 1: It's absolutely zero risk for you.
• 1:31
  Speaker 1: But let's get into the market.
• 1:34
  Speaker 1: Gris is back.
• 1:35
  Speaker 1: We couldn't afford the D today.
• 1:37
  Speaker 1: It's an expensive D.
• 1:38
  Speaker 1: Yes, we're back in greed.
• 1:40
  Speaker 1: What do you normally do when the market's greedy?
• 1:42
  Speaker 1: Is that the point where you buy?
• 1:44
  Speaker 1: You got to ask yourself that and you have to also look at are these stocks now expensive?
• 1:48
  Speaker 1: And I'm going to answer that for you in just a few minutes.
• 1:51
  Speaker 1: But this is generally a little bit of a warning sign when we are in the greed space, although the best rallies also could take place in the greed space.
• 2:00
  Speaker 1: So that's always the balance there.
• 2:01
  Speaker 1: We have had literally the best start to the year this century, I kid you not.
• 2:09
  Speaker 1: So right now we are here, which is the very, very top end of all years this century.
• 2:16
  Speaker 1: So pretty extraordinary rally that we're seeing and we're lucky to be live for that.
• 2:21
  Speaker 1: Almost as extraordinary as our teaching portfolio, which is literally up 93%.
• 2:28
  Speaker 1: And yes, that's a combination of good indicators, but it's also risk management risk management and risk management and how we automate that.
• 2:35
  Speaker 1: You want to come and learn that.
• 2:36
  Speaker 1: You can also learn that with me for free.
• 2:38
  Speaker 1: This week we're running our beginner trading challenge on Wednesday and Thursday, 8 am New York time, 1 pm London time, at FelixVencelog slash challenge.
• 2:48
  Speaker 1: So grab yourself a seat there.
• 2:50
  Speaker 1: It's part of our mission to make a million people financially free, so check it out.
• 2:54
  Speaker 1: So I just asked you the question are stocks expensive?
• 2:57
  Speaker 1: And I guess you're going to answer well, it depends, doesn't it?
• 3:00
  Speaker 1: Have you got a crystal ball?
• 3:02
  Speaker 1: Well, if you don't have a crystal ball, this is a pretty good one, and this comes out from, I want to say, deutsche, one of the banks.
• 3:10
  Speaker 1: And what have you got?
• 3:12
  Speaker 1: You've got in light blue here, the stock price, stock price, if I could spell stock price.
• 3:18
  Speaker 1: You've got the slightly darker bluish tone which I don't really have, or I do actually.
• 3:24
  Speaker 1: Thank you, microsoft, you've got that line up there and that is, forward earnings per share.
• 3:32
  Speaker 1: So what's the profit expectation of next year for these stocks?
• 3:35
  Speaker 1: Now we're looking here only at the largest six tech stocks, top six of the market Microsoft and Appleton and videos and so on.
• 3:44
  Speaker 1: And then we're also looking at the bottom here, that sort of brownish line, the PE, but not the current PE, again forward PE.
• 3:56
  Speaker 1: So next year's PE, the market's forward looking.
• 3:58
  Speaker 1: The market doesn't really care what happened last quarter.
• 4:03
  Speaker 1: The market cares mostly about what's going to happen in the next year.
• 4:04
  Speaker 1: So what is that saying to you?
• 4:05
  Speaker 1: Well, it's saying to you that, yes, stock prices have gone to the moon, but actually so have expectations of profits.
• 4:13
  Speaker 1: And if you look at the gap between forward earnings per share and the stock price right now, we are arguably actually a little undervalued Now, traditionally a little bit below that.
• 4:26
  Speaker 1: But all I'm saying is that actually these top six tech stocks are actually looking pretty cheap.
• 4:36
  Speaker 1: I mean not cheap, but not crazily overvalued.
• 4:40
  Speaker 1: So that's good to understand, right.
• 4:42
  Speaker 1: And then came Jerome, the harbinger of truth, wisdom, insight, good morals, ethics.
• 4:51
  Speaker 1: He's just the most wonderful, perfect man, right?
• 4:53
  Speaker 1: If there was a perfect man it would be Jerome the untouchable Powell.
• 4:58
  Speaker 1: And he just said well, he didn't say this, but I'll give you some quotes in a second.
• 5:03
  Speaker 1: We've had this really insanely strong economic data coming out from the US government since August, and I'm a cynic on that because I think you get very good economic data just before an election Because the lot trying to get reelected.
• 5:22
  Speaker 1: I want to show you that the economy is strong and it's not a political view.
• 5:26
  Speaker 1: The other side would do exactly the same thing.
• 5:29
  Speaker 1: It's just the reality of the market, and one thing we saw over the weekend is that they added $500 billion to GDP.
• 5:40
  Speaker 1: How did they do that?
• 5:41
  Speaker 1: You just put a number in a spreadsheet and you publish it and you call it a revision.
• 5:45
  Speaker 1: Nobody reads revisions because they're boring and they're old news.
• 5:48
  Speaker 1: But that's what they just did and that's one of the reasons the economy looks so good.
• 5:51
  Speaker 1: And don't get me started on labor data.
• 5:53
  Speaker 1: So I'm a little dubious on this.
• 5:54
  Speaker 1: But if this were true, if the economy was truly improving this strongly, why the heck is the Fed cutting rates?
• 6:02
  Speaker 1: Well, maybe they should, because, should they, they don't need to stimulate the economy, do they?
• 6:08
  Speaker 1: Everything is fine with 5% interest rates, now 4.5%.
• 6:11
  Speaker 1: So that's kind of the question here.
• 6:14
  Speaker 1: So what does Powell know that we don't know, the market doesn't know.
• 6:18
  Speaker 1: Well, he said yesterday at 2 pm, and I quote it doesn't feel like the Fed is in a hurry to cut quickly.
• 6:25
  Speaker 1: And everyone was like I'm sorry, I'm sorry, you're not in a hurry to cut quickly.
• 6:29
  Speaker 1: We thought you were in a hurry to cut quickly.
• 6:30
  Speaker 1: That's exactly why we're here, that's why the rally is happening.
• 6:46
  Speaker 1: And if you look at the S&P, what happened at 2 pm?
• 6:47
  Speaker 1: This was 2 pm at the moment the chosen one spoke and we dropped pretty harshly.
• 6:49
  Speaker 1: Now we did recover and actually end the day in a decent level, but that dip there kind of scared the bejesus out of the market.
• 6:54
  Speaker 1: And I'll show you why.
• 6:56
  Speaker 1: We have expectations of rate cuts.
• 6:59
  Speaker 1: And again, the market cares only about the future, not really the past.
• 7:03
  Speaker 1: And until 2 pm the market was expecting three cuts.
• 7:10
  Speaker 1: They were promised and delivered and ordered and Amazon Prime was going to deliver them to you before Christmas, guaranteed.
• 7:17
  Speaker 1: And after Powell has spoken, we're now only expecting two and a bit cuts.
• 7:23
  Speaker 1: So that's a bit of a bummer, because tech stocks, fintech stocks, biotech stocks they all thrive on rate cuts.
• 7:31
  Speaker 1: So that's a little bit of a cautious thing there.
• 7:33
  Speaker 1: But then we also know rate cuts, so that's a little bit of a cautious thing there.
• 7:37
  Speaker 1: But then we also know Jerome, the chosen one, that he tends to play this game.
• 7:42
  Speaker 1: He gives you a bit of good news and then he tries to take it away with words.
• 7:43
  Speaker 1: But we know your words mean very little, jerome Powell, because you also told us that inflation would be transitory.
• 7:48
  Speaker 1: You also said to us that printing $4 trillion would not cause any inflation.
• 7:55
  Speaker 1: So I don't take them all that seriously.
• 7:57
  Speaker 1: To be honest with you, I think really what we want to watch out for is what's going on with economic data, and can we get some decent data that isn't government manipulated sorry, seasonally adjusted?
• 8:09
  Speaker 1: One data point this week comes from the ADP, which is a private company that I'm actually a shareholder of, and they publish jobs data.
• 8:19
  Speaker 1: So watch out for that, perhaps a little bit more than the non-farm payroll data that Biden publishes.
• 8:26
  Speaker 1: He was asked today about the Israel Lebanon war and the strikes on the Yemen port, and you know what Biden said.
• 8:36
  Speaker 1: He said I've talked to both parties, I support the bargaining positions and I think they will sort it out.
• 8:44
  Speaker 1: He was obviously referring to the trade union dispute around US ports, but then you know he's half retired, right, half his mind is also retired.
• 8:53
  Speaker 1: And again, the Democrats.
• 8:55
  Speaker 1: You even say I'm going to go, felix, in the Republican.
• 8:58
  Speaker 1: No, I don't have to vote, I don't have to care, I just nail it down and narrow it down to how it affects my money.
• 9:04
  Speaker 1: Yeah, that's it really.
• 9:06
  Speaker 1: So what could be the trade of the century here then today?
• 9:09
  Speaker 1: Well, there are two things that have worked very, very, very, very nicely together, and that is one in green, green with envy.
• 9:19
  Speaker 1: You've got, basically, global liquidity.
• 9:25
  Speaker 1: What's global liquidity?
• 9:28
  Speaker 1: Think of it as all the money in the world and money gets generated by central banks printing money and banks lending it out again and again and again and again.
• 9:38
  Speaker 1: It's a round and round sort of thing.
• 9:40
  Speaker 1: And then you've got in blue Bitcoin yeah, very simple Bitcoin.
• 9:46
  Speaker 1: And you might be thinking, oh God, felix is becoming a kryptonite person.
• 9:50
  Speaker 1: Well, there could be something in this, so let me walk you through it.
• 9:54
  Speaker 1: So, if you look at, well, I'll show you how we trade in a second.
• 9:58
  Speaker 1: First, come and join me and learn some exit rules.
• 10:00
  Speaker 1: If you don't know risk management, if you don't know how to automate your profit digging and your risk management, you will always lose money.
• 10:06
  Speaker 1: That's basically a given.
• 10:07
  Speaker 1: So come and learn how we do it, how we've learned it, how we've taught thousands of people to do it, and that's helped us to be up 93% so far this year.
• 10:16
  Speaker 1: This is our teaching portfolio.
• 10:17
  Speaker 1: So head over to felixfrenzorg slash challenge here it is and links down below and sign up and show up and be on time.
• 10:26
  Speaker 1: Now a couple of ways of trading Bitcoin.
• 10:29
  Speaker 1: One you could buy Bitcoin.
• 10:32
  Speaker 1: I know, revolutionary, right, but what's a little bit the problem with it and what's also the good thing?
• 10:37
  Speaker 1: Well, just connect.
• 10:38
  Speaker 1: When you see a chart like this, connect the tops of all the tops, right, straight line, and what do you see?
• 10:43
  Speaker 1: Well, it's going down.
• 10:44
  Speaker 1: It's not brilliant and even the lows are sort of looking like that.
• 10:50
  Speaker 1: So it's definitely trending down.
• 10:52
  Speaker 1: But you know what's quite nice?
• 10:54
  Speaker 1: The longer you do this sort of sideways action, the more people get frustrated and people fall out of it and people sell it.
• 11:02
  Speaker 1: People get annoyed and that's why you sort of trend a little bit downwards and sideways.
• 11:05
  Speaker 1: But the longer you do that, the eventual breakout gets bigger and bigger the longer you trade sideways.
• 11:12
  Speaker 1: So actually, long sideways actions like we've had here tends to lead to very meaningful upsides Now?
• 11:19
  Speaker 1: Do?
• 11:19
  Speaker 1: I think it's the moment?
• 11:20
  Speaker 1: No, I don't.
• 11:20
  Speaker 1: I think it's too early.
• 11:21
  Speaker 1: And, of course, all the crypto cry, he's got no idea.
• 11:24
  Speaker 1: I think he's going to go up to the moon a thousand times by Christmas.
• 11:28
  Speaker 1: Now there is another option.
• 11:30
  Speaker 1: Again, my spelling today fails me.
• 11:32
  Speaker 1: There are two stocks that I quite like to trade on this, and that's CLSK or Mara.
• 11:37
  Speaker 1: And let me show you so if you go into trade vision here, where you can see all of our glorious little indicators, so the green bits are where we buy, the red bits are where we exit.
• 11:46
  Speaker 1: So just on the S&P, for example, buy and hold since the beginning of 2022, 19%.
• 11:54
  Speaker 1: We did 34%, which is not bad right, but something like Tesla, for example, but a bit more volatile.
• 11:59
  Speaker 1: It's down 44%.
• 12:01
  Speaker 1: If you bought and hold it.
• 12:02
  Speaker 1: Our indicators up 81%.
• 12:04
  Speaker 1: It's pretty good.
• 12:04
  Speaker 1: Obviously not a promise of future returns or any of that, but just it's an indicator that's pretty good.
• 12:09
  Speaker 1: So CLSK has, believe it or not, lost 3% since the beginning of 2022.
• 12:17
  Speaker 1: And it's clean spark.
• 12:18
  Speaker 1: By the way, the trends indicator, we managed to squeeze 40% of profits.
• 12:21
  Speaker 1: And we're not saying buy it here.
• 12:23
  Speaker 1: We're not, but I would wait for that signal A little bit the opposite of what I just said on Bitcoin.
• 12:34
  Speaker 1: When you have this kind of a pattern above the stock price, what tends to happen is that you go up, yay.
• 12:42
  Speaker 1: And then what happens?
• 12:43
  Speaker 1: Well, you get into here and now all of these buggers, even bag holders, they sell.
• 12:48
  Speaker 1: That's typically what happens.
• 12:50
  Speaker 1: So that's something to bear in mind.
• 12:52
  Speaker 1: So you're probably going to go into this and you're going to do a little bit of this, and then you're going to do a bit of this and you're going to do a bit of this and a bit of this and a bit of that, and that's kind of how you're going to do it.
• 12:58
  Speaker 1: So it isn't going to be a shot through it.
• 13:01
  Speaker 1: So, clsk, we wait, we wait for the alert, essentially.
• 13:04
  Speaker 1: And then what about Mar?
• 13:08
  Speaker 1: Well, again, the stock's down 51%.
• 13:15
  Speaker 1: By trading it, we would have managed to make 157%.
• 13:18
  Speaker 1: Why?
• 13:18
  Speaker 1: Because we just trade the bits that go up.
• 13:20
  Speaker 1: Occasionally we're wrong, like here was one that we were wrong on, but most of the time and that's, of course, why risk management is so bloody important we tend to be quite nicely with it.
• 13:31
  Speaker 1: So, again, is this the moment to buy it?
• 13:32
  Speaker 1: No, I would argue not.
• 13:34
  Speaker 1: I would argue that you have right now, sort of a downward pattern type thing here, something like that anyway, and we need to like break out of that meaningfully.
• 13:45
  Speaker 1: And there's a little bit of that warning again that these guys here well, they've probably been shaken out by now.
• 13:52
  Speaker 1: In fairness, they're probably not that many people.
• 13:54
  Speaker 1: There will be some people who put a board up here.
• 13:56
  Speaker 1: That'll be resistance.
• 13:58
  Speaker 1: So what do we do?
• 13:59
  Speaker 1: We just wait.
• 13:59
  Speaker 1: We just wait for the signal.
• 14:01
  Speaker 1: That's really all it is.
• 14:02
  Speaker 1: So we send out daily email alerts on these and everything else so you can check that out.
• 14:07
  Speaker 1: But of course, you can also look at the charts individually yourself.
• 14:10
  Speaker 1: But I don't buy stuff just because everyone's talking about it.
• 14:21
  Speaker 1: I don't buy it because I think there is this theoretical macro-driven, money-printing-driven thing going on.
• 14:25
  Speaker 1: Yes, I think it's possible.
• 14:26
  Speaker 1: I think it's actually a very distinct possibility that the world will pump more money into the system again and therefore assets go up a lot and risk assets risky assets like Bitcoin would probably go up more.
• 14:37
  Speaker 1: But I'm going to wait for the chart to actually acknowledge that, because that means the market's acknowledged it and otherwise I'm just tying money up for like no reason, for absolute ages and not a lot and it doesn't really get me anywhere.