Latest / Felix Nikolas Prehn's Podcast / Felix Prehn - FED’S Surprise Move LIVE + Stock Market News 04 June 2025

Transcript

Felix Prehn - FED’S Surprise Move LIVE + Stock Market News 04 June 2025 · Felix Nikolas Prehn's Podcast

• 0:00
  Speaker 1: Felix here and we've got a day where literally everything is turning upside down.
• 0:04
  Speaker 1: We have a massive, massive Fed fight on our hand, and I'll show you why.
• 0:10
  Speaker 1: The Fed is actually too late and, for once, the brilliant man in the White House is actually right on this one.
• 0:17
  Speaker 1: We'll also look at whether it is time to jump on the short squeeze in small caps.
• 0:21
  Speaker 1: Is time to jump on the short squeeze in small caps?
• 0:24
  Speaker 1: The promised small cap rally seems to finally be basically there.
• 0:30
  Speaker 1: Before you buy that, make sure you wait till we get to that second, because there's some key levels you need to look at, and I want to explain to you why.
• 0:39
  Speaker 1: Bad news is actually good news right now.
• 0:41
  Speaker 1: We've got a lot of stuff going on there trade, tariffs, disputes, all that stuff and also the AI rally is creeping back very slowly, and a lot of people are missing out on that very, very, very simple investment path right now, and I want to make sure you're not one of those people.
• 0:57
  Speaker 1: In fact, I want to do one better, as I'm sitting here at yet another hotel.
• 1:01
  Speaker 1: Anybody who can guess where I am, you'll win.
• 1:03
  Speaker 1: Win a cookie if you actually want to know what to buy and not just chase the latest thing, whether it's the crowd strike collapse today, or hpe which is exploding or whatever opportunity you see out there.
• 1:17
  Speaker 1: If you want to get rid of that fomo and replace it with the actual rules that Wall Street uses and has been using for like five decades, then well, come and learn, and I suggested the other day where you could maybe kidnap the CEO of a major bank and find out that way.
• 1:35
  Speaker 1: That probably isn't a brilliant idea and would be a little bit easier if you came and joined me and about a thousand other people who simply want to retire earlier, retire better, and join us on Saturday at 10 am, new York time.
• 1:48
  Speaker 1: Live for some proper education, which you should have been taught when you were like this big.
• 1:55
  Speaker 1: So the link's down below felixfrenzorg slash webinar.
• 1:57
  Speaker 1: I'll pin it into the chat as well, and actually I pinned one from Steve into the chat, if you can see that he wrote in January.
• 2:06
  Speaker 1: I retire Mostly thanks to Winston for teaching me how to properly invest and, stephen, nothing makes me happier Congratulations.
• 2:14
  Speaker 1: I hope you have an amazing retirement that is amazingly better than your life has been so far, and that you keep enjoying the investing journey and it'll keep making you freer and wealthier, because you know how it works right.
• 2:27
  Speaker 1: It just gets better and better and better and better if you keep following the system.
• 2:30
  Speaker 1: So a huge congratulations to Stephen there.
• 2:32
  Speaker 1: Let's give Stephen a round of applause.
• 2:34
  Speaker 1: Just put some Stephens or some S's in the chat down there and I'll share my screen with you while you guys are doing that, because there's nothing that makes me happier, honestly, than seeing people win because they are actually learning and they're applying the proper rules.
• 2:53
  Speaker 1: So stream seems healthy on my end.
• 2:57
  Speaker 1: Yeah, congrats, stephen.
• 2:58
  Speaker 1: You see that coming in there, s-s-s-s-s.
• 2:59
  Speaker 1: Stephen.
• 3:03
  Speaker 1: Seriously, it's amazing.
• 3:04
  Speaker 1: The turnaround is so beautiful to see.
• 3:06
  Speaker 1: That's why we do what we do do here.
• 3:07
  Speaker 1: So this is what we're going to run through here the fed policy fight as well as look at all those s's there.
• 3:11
  Speaker 1: Steven, I hope you're still with us.
• 3:12
  Speaker 1: The fed is too late.
• 3:14
  Speaker 1: Small caps that's a big opportunity, potentially the bad news being good news.
• 3:19
  Speaker 1: And then the ai rally.
• 3:20
  Speaker 1: And then, of course, we'll do a nice big juicy Q&A and look at your favorite tech stocks, if you wish, stick around and if you see some value in that, after you've put all the steves and therefore steven put on the v and therefore value as well.
• 3:36
  Speaker 1: This just out from Donald J Trump.
• 3:38
  Speaker 1: Adp numbers out.
• 3:40
  Speaker 1: Adp is a private company that collects jobs data and he's saying, basically, powell is too late and he has a point.
• 3:52
  Speaker 1: Let me show you the data and what this actually means, because it's not just about random data.
• 3:56
  Speaker 1: It's about how does this impact my investing portfolio there.
• 4:00
  Speaker 1: Loving all the congratulations there, guys to Steve and Steve, I hope you feel how big a deal this is going to be for yourself and your family what you're doing there.
• 4:09
  Speaker 1: So we've got the ADP jobs data in at these levels, which is like the lowest level since the March 2023 dump there.
• 4:19
  Speaker 1: So it's pretty low and it just means that we're not generating private jobs in the US.
• 4:24
  Speaker 1: And this data is typically not manipulated because it's actually a private company.
• 4:29
  Speaker 1: It is coming from the government.
• 4:30
  Speaker 1: And what is the government doing about it?
• 4:33
  Speaker 1: Well, the Fed's doing nothing, absolutely nothing.
• 4:36
  Speaker 1: You listen to all the Fed presidents and they're all saying we've got no real interest in doing anything.
• 4:41
  Speaker 1: The data doesn't tell us to, which is pretty weird.
• 4:44
  Speaker 1: Actually, I'm coming around to that idea because they cut interest rates before the election, when inflation was way higher and all the economic data was pointing in the direction of don't cut.
• 4:56
  Speaker 1: Now the data is way worse and they're not cutting, so it makes very, very, very little sense.
• 5:04
  Speaker 1: I appreciate all the Vs and all the congratulations there to Stephen Absolutely brilliant Stephen.
• 5:09
  Speaker 1: So come and learn what Stephen has learned and what Stephen is learning.
• 5:12
  Speaker 1: I've pinned it to the chat here right now, which is felixfriendsorg slash webinar.
• 5:18
  Speaker 1: You can click on that and grab yourself a free seat over there.
• 5:21
  Speaker 1: So what is the US government doing about it?
• 5:24
  Speaker 1: Well, they've just done something that the US has never done before.
• 5:27
  Speaker 1: They have bought back $10 billion of their own debt.
• 5:34
  Speaker 1: That is the biggest buyback in US history.
• 5:37
  Speaker 1: So what does that mean?
• 5:38
  Speaker 1: Well, the US government is basically saying anybody who owns my debt, I'm going to buy it back, and that is essentially money printing.
• 5:47
  Speaker 1: Now, usually the Fed would do this, but the US government is doing this, which is sort of odd given that they're running this massive deficit.
• 5:55
  Speaker 1: But they're basically trying to help out the bond market so it doesn't completely collapse, and you can see it here.
• 6:01
  Speaker 1: They've been doing a fair bit of this of late, but this is the biggest one the bigliest one, as it's officially known that we have ever seen.
• 6:10
  Speaker 1: So it's kind of an interesting one.
• 6:21
  Speaker 1: So let's move on past that and actually look at some opportunities.
• 6:24
  Speaker 1: And I also want to show you.
• 6:25
  Speaker 1: We look at CrowdStrike, we look at HPE and a bunch of other ones that are moving bigly today.
• 6:29
  Speaker 1: Now this is the Russell, so ticker symbol IWM usually for most people.
• 6:37
  Speaker 1: Let me get a pen IWM.
• 6:40
  Speaker 1: There are others, obviously that track it.
• 6:42
  Speaker 1: But what do you see here?
• 6:43
  Speaker 1: Can you see that it's nicely that pattern?
• 6:47
  Speaker 1: And what do you see here?
• 6:49
  Speaker 1: Can you see that it's nicely that pattern?
• 6:51
  Speaker 1: What does that look like?
• 6:51
  Speaker 1: Um, no rude comments please.
• 6:52
  Speaker 1: Uh, but the left thing is a shoulder and then you have a head down there and you have a shoulder on the right and an upside down head and shoulder pattern.
• 6:59
  Speaker 1: So normally we we see it often that way.
• 7:02
  Speaker 1: Again, I don't want any rude comments in the chat here.
• 7:05
  Speaker 1: This is a clean channel mostly, and when they're upside down it is probably the most potent pattern that we see for a breakout signal.
• 7:20
  Speaker 1: So is it a breakout yet?
• 7:22
  Speaker 1: Well, let's have a look at a stock chart, and I'll pull one up here for you in Trade Vision, which is, as you know, the software that we build to give you guys the best stock and options data, and if I type in IWM here, you can see that right, you can see that pattern here.
• 7:43
  Speaker 1: So what do we look for?
• 7:44
  Speaker 1: Well, very simply, we connect the armpits, we draw a line from one armpit to the other and then, if you break out above the armpit, that's your breakout.
• 7:58
  Speaker 1: We're not quite there yet, but we are almost there.
• 8:02
  Speaker 1: We are really, really, really close, as you can see here, really, really, really, really, really close, which is brilliant.
• 8:10
  Speaker 1: Give us 210 or something like that and we potentially have that breakout.
• 8:18
  Speaker 1: Now, if you're a little bit more cautious, you will notice we're still below the 150-day moving average line here, which is a purple line there, but potentially this could get very, very interesting.
• 8:31
  Speaker 1: Options might be a way to play that, which is a lot lower risk, but we don't need to go into the super details of that.
• 8:35
  Speaker 1: But for you, option screens out there have a look at that.
• 8:38
  Speaker 1: They're relatively inexpensive and I'm not talking to buy a call option.
• 8:40
  Speaker 1: I'm probably talking about a spread or something like that.
• 8:43
  Speaker 1: Here.
• 8:43
  Speaker 1: It looks like Winston.
• 8:47
  Speaker 1: It does a little bit, doesn't it?
• 8:48
  Speaker 1: It does a bit with the ears.
• 8:49
  Speaker 1: You mean, we should call it the Winston right Left ear, winston's head nose, right ear.
• 8:55
  Speaker 1: Yeah, that would work.
• 8:56
  Speaker 1: That would work too.
• 8:57
  Speaker 1: We'll call it the Winston from now on.
• 8:59
  Speaker 1: So that's something to definitely watch, because small caps have absolutely underperformed absolutely everything else out there and they're still.
• 9:06
  Speaker 1: How much are they down from the all-time highs here?
• 9:09
  Speaker 1: 14%, which is pretty significant for an index.
• 9:11
  Speaker 1: That was the all-time high, wasn't it?
• 9:14
  Speaker 1: I think so.
• 9:14
  Speaker 1: So that's definitely one to watch.
• 9:19
  Speaker 1: Now, I promised you some more, didn't I?
• 9:20
  Speaker 1: And we'll look at those in just a second.
• 9:22
  Speaker 1: And is that useful to you, by the way, to like look at a pattern like that and go, okay, this is what people look for.
• 9:27
  Speaker 1: This is sort of one of those rare patterns, and I'm not somebody who kind of goes out there and spots random patterns and you know cups and saucers and you know aliens and and giraffes and that sort of thing what some people do.
• 9:38
  Speaker 1: But this is the one that I do actually look for, and this strengthens the case for this very, very, very significantly.
• 9:48
  Speaker 1: Why?
• 9:49
  Speaker 1: Well, let's ask the 2,300 people who have not hit the like button yet.
• 9:55
  Speaker 1: Clearly, there is no value in the stream whatsoever.
• 9:58
  Speaker 1: So why are you here?
• 9:59
  Speaker 1: Ask yourself that.
• 10:00
  Speaker 1: It's always a little bit like that, isn't it?
• 10:02
  Speaker 1: Okay, we're getting some yeses there, useful, and some use, okay, brilliant guys, I love that.
• 10:08
  Speaker 1: So this is short interest for the Russell 2000, which are the small caps, and as you can see, it's at pretty bigly levels.
• 10:19
  Speaker 1: Right, that is the new adjective that we use 5.5%, that's pretty high.
• 10:25
  Speaker 1: We've not seen anything like that in the last.
• 10:27
  Speaker 1: Well, I've got data going back about six years here.
• 10:29
  Speaker 1: So that means, if it does go up, what do these people have to do?
• 10:34
  Speaker 1: We've shorted the small caps.
• 10:36
  Speaker 1: Well, they're losing money when the small cap stock price goes up and therefore they have to buy it.
• 10:43
  Speaker 1: Why do they have to buy it?
• 10:44
  Speaker 1: Because they've sold it.
• 10:46
  Speaker 1: Short means you've sold it.
• 10:47
  Speaker 1: The only way to close a short position is to buy the actual stock, which then drives the stock price up even further, which means everybody else who's short is now closing their positions.
• 10:57
  Speaker 1: They're buying.
• 10:58
  Speaker 1: It causes what we call a short squeeze, potentially right, but I would wait for that little line at least to be triggered, possibly even close above it.
• 11:11
  Speaker 1: And then you've got to ask yourself whether you want to buy stuff below the 150.
• 11:14
  Speaker 1: That's a whole different story, but it's starting to look very, very interesting, certainly on my watch list as of today.
• 11:23
  Speaker 1: Now anything else?
• 11:28
  Speaker 1: Yes, the donald has been rather active tweeting.
• 11:32
  Speaker 1: He also tweeted this.
• 11:33
  Speaker 1: He said that the president of china is very tough and extremely hard to make a deal with and you would expect the stock market to go all right, the trade war will continue.
• 11:43
  Speaker 1: This is a problem.
• 11:45
  Speaker 1: Right, the tariffs will stay in place on China.
• 11:49
  Speaker 1: They'll go back up higher in 35 days, whenever that is, and therefore you'd expect the market to drop, because last time these tariffs were announced, the market absolutely collapsed.
• 11:58
  Speaker 1: But have they?
• 11:59
  Speaker 1: Well, the easiest way to look at that would be just to look at the VIX, look at the fear.
• 12:04
  Speaker 1: Is the fear back?
• 12:06
  Speaker 1: Well, it's trading at 1768.
• 12:10
  Speaker 1: That is the lowest level of fear we've been at for may 16th, in fairness, but we're basically back to below march levels, right, we're back to pre-trump scares the bejesus out of the market levels, right.
• 12:28
  Speaker 1: So pre liberation day levels.
• 12:31
  Speaker 1: So the market is accepting that tariffs are not terrible and that's a huge, freaking change Because it means, even if we don't get trade deals or we get terrible trade deals, the stock market isn't going to collapse.
• 12:49
  Speaker 1: Do you see how important that is?
• 12:52
  Speaker 1: Do you see how that is a realization, which means we're probably not going to see a massive drawdown again anytime soon.
• 13:01
  Speaker 1: I still think we're going to see choppiness when these deals don't go full through and if in 35 days there are no trade deals, I think we're going to go down somewhat.
• 13:09
  Speaker 1: But I don't think we're going to see the same level of sell-off again, because the fear is just simply not there.
• 13:18
  Speaker 1: On a day like today, like we're down on the VIX, which is the fear index, on a day like today, which is just extraordinary, taco Bell, that might have something to do with that.
• 13:28
  Speaker 1: But let's see, right, let's see.
• 13:31
  Speaker 1: If there's no deal, is Trump going to be tough and is he going to put in 50% tariffs on all the Chinese stuff and just leave him there?
• 13:38
  Speaker 1: Right, he can do that.
• 13:40
  Speaker 1: And then what happens?
• 13:42
  Speaker 1: Well, apple is in trouble, for example.
• 13:45
  Speaker 1: Right,