저자: Kevin · 외국인
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트럼프 중동 딜과 풋콜비율 급감으로 시장 강세 전환 확인. 1분기 실적은 양호할 것으로 보나 6월 이후 4~5월 소비·고용 데이터에 따라 불안 가능. 실업률 1%p 상승 같은 경우 연준 인하 촉발 우려. 연준 6월 인하 확률 낮고 9월 인하 전망, 8월경 경기침체 여부 판단 가능. 관세는 1930년대 이후 최고 수준으로 영향 미지수. 보유 종목은 트레일링 스톱 활용 권고.
다듬은 글
Hey everyone, me Kevin here. Wow, markets are absolutely on a tear as Donald Trump is announcing deals from the Middle East and we are now seeing the put call ratio. In other words, the number of people buying bearish options at a low that we have not seen since December of 2020. In other words, markets are the most bullish in the options market that we have seen since the end of 2020.
This is pretty remarkable. And in this video, we've got to understand what's next because here's a clip of what I said over 3 weeks ago. Take a listen to this and then I want to tell you what to pay attention to going forward because I think that matters a lot. Hey everyone, me Kevin here. Uh, in this video I want to give a breakdown of why I actually think now is oddly a bad time to sell stocks.
And I know that sounds crazy, like what? Kevin's saying it's a bad time to sell stock. I I know. I know. Give me a sec. Hear me out here. Okay. It's too noisy out here. All right, here's the scoop. Q1 earnings are going to be good. As we've already seen, why would Q1 be bad? January was full of hope.
February, March, mostly March was full of pull forward. Of course, we're going to have good earnings. So, we're probably going to have good earnings for the rest of the next four weeks. You know, Nvidia is always late. Probably have good earnings, especially with comments out of Google. Hey, so far macro keeps staying fine the way it is.
We're going to keep spending. Great. And then after we get more good Q1 data, well, you know, poopy doesn't hit the fan until July. So, what's what's the rush? So, why did I say that 3 weeks ago? Why did I say don't sell stocks now? Because the data is about to be good. It's not because we believe that Donald Trump tomorrow was going to go to 000 or slash Chinese tariffs from 145 to 30.
It's because we believed that Q1 earnings and Q1 data was going to come in because it always lags. But that information was going to be good and bullish because we front ran the very April tariffs that everybody was afraid of in April. That meant we probably had bullishness coming for markets and that's what we've been talking about in the alpha report for the last 3 weeks.
But I also publicly spoke about it on YouTube and you saw the video. But now what matters isn't looking at the past and going, "Oh, look, yay. We have now broken the 200 day moving average on the NASDAQ 100 again. We're back technically to a bull market on the NASDAQ 100. We're up 20% from bottom to where we are now.
Technically, the S&P 500 is year-to- date positive again, which is pretty remarkable. We, as we just saw, we're not only back at the greed indicator on fear and greed indicators, but options positioning is extremely bullish. This is partly because corporations are conducting significantly larger buybacks than we expected, but also in part because analysts have already downritten a lot of Q2 earnings expectations, which makes a lot of institutions think, okay, has the worst been baked in and is it now time to buy?
Well, let's evaluate what the next problems are that we want to pay attention to, if any. So, first things first, I think for the rest of May, there's little that could really go wrong. Now, that's not to say something won't go wrong, but right now it would almost have to be a black swan because think about it, for the rest of May, we don't really have any major earnings.
We have lingering earnings coming in. Nvidia earnings will be coming in. Nvidia has expectations, especially now with these Saudi chip deals, of being very, very enthusiastic. But broadly, a lot of our earnings are already behind us. We already have the Federal Reserve meeting behind us and the 102 spread is back at 47 under 50.
So, under shock threshold. Now, again, that's not a light switch, so it could create problems and who knows, sometimes when markets are most bullish, people start fading again. But because I think a lot of people are utilizing the trailing stop strategy that I've been advocating for the almost the last month now, I think a lot of people probably won't until we actually get negative catalyst.
And so this then begs the question, what negative caddies do we really have left in May? Well, honestly, not much. So unless we get some kind of really bad EU tariff risk, that's probably the biggest risk right now is tension between the European Union and Donald Trump. The EU doubling down on their support for Ukraine.
The EU doubling down on their retalatory tariff threats against Trump. Trump saying that the EU is being more mean to him than China, which remember we just still you know 5xed uh tariffs uh across the board with you know China has now 5x the tariffs on us that they previously had and we have somewhere around 15x the tariffs on them that we used to have.
So we are still at the highest level of tariffs since the smooth holiday era of the 1930s. So like don't get me wrong, tariffs are still way worse, but it's too early for that sort of stuff to impact us. So the biggest thing right now for May is just EU tariff drama. I think in June, this is where things get a little bit more interesting because what happens in June is we're going to start getting that April and May data.
Now hopefully after this Chinese trade deal, we're not so worried about empty shelves or this inventory issue, what we're worried about is now what we have to worry about is coming up right after this message from our sponsor and it's very important to cover what's next. So buckle up. And now for a word from our sponsor public.com.
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Give it a shot. Download the app and look around. See if it fits what you're looking for. Give it a shot. Check out the sponsor and the link down below. Public helps the channel out and helps make your investing life easier. Inventory issue. What we're worried about is consumer momentum. Now, there's something that I like to refer to and I like this reference.
Uh I think about Newton for example and Newton's laws. Uh objects in motion remain in motion and objects at rest remain at rest. Right? Something that can happen when you go through the drama that we had in April, no guarantees, but something that can happen is when you slow out the consumer's willingness to spend, you basically, I like the plane analogy, you stall them out, right?
So, you freak them out and they're nervous. Oh no, we're going to hit a tree or we're going to hit a wall or whatever. They're like, oh no, no, no, no, no. You know, now you're stalling out the plane. Well, you could potentially keep that individual much more cautious. Hopefully, you we didn't stall out the economy, but maybe that momentum is now a lot slower.
Now, instead of flying at 450, you know, knots of ground speed, we're sitting, you know, closer to our stall speed in slow flight at 120 and we're like, I don't know, man. Let's let's just be cautious over here. Sometimes that can happen where the consumer slows down. Now, the good news is markets going up could help the wealth effect and people's desire to spend.
But sometimes when businesses start cutting, they don't stop cutting just because some of the catalyst ended. So, for example, Microsoft now laying off 3% of its workforce. What potentially happens if we see that consumer and business momentum of cautiousness continue? When do we actually start seeing that sort of data?
Well, realistically, we're not going to get the April, May data until probably I would say mid uh well, I'll I'll say early June uh to late June. That's really when we're going to get the data. Now, I actually think that if we can get to August, August, September, uh without a significant rise, so call it 1% uh in unemployment, that would be one percentage point.
So, let's make that clear. I'll put a P behind that. Uh, so that would be going from like 2.4 to 5 point uh 4. Sorry, going from 4.2 to about 5.2. If we rose a percent in unemployment, this would be problematic. This would actually trigger uh Fed cuts rapidly. But not only does it trigger Fed ruts rap cuts rapidly, it also makes people nervous and creates more of this sort of Newton slowdown, which we don't want.
We don't get that data until June or late June, which means really markets are probably going to start getting nervous about that June data. End of May, June nervousness. Now, who knows? That could just be uh it it could not happen. It could be little, you know, diply doodlas, whatever. I continue to maintain, as I have for the last 3 weeks, and I've been very clear about this, trailing stops are the way to go.
Trailing stops are a great way to take profit on stocks that are having a momentum run and you don't, you know, as soon as that momentum dies off, you want to just automatically have that stuff sell and free up some of your cash. Doesn't mean you have to sell out of everything, right? But you take a little bit off the table and you go invest in something else.
That I think is the way to go for May. So now when it comes to the Federal Reserve, we don't actually have the Fed meeting uh until the third week of June. I think it's the 18th and 19th. Uh if I remember that correctly, it's it's right around the 18th or 19th. We can perfect that or correct me in the comments here.
We don't need to look it up right now. But the point is markets are only expecting an 8.3% chance of a cut in June. In other words, it ain't going to happen. you know, maybe you're at about a 39% chance of a cut in July, but realistically, you're not pricing in a full cut until September, and the Fed doesn't need to because the unemployment data is still stable.
Now, yeah, 27 weeks unemployed is rising. Uh, you know, we're seeing sectoral weakness. We're seeing uh, you know, the jolts levels and the quits levels all indicate a slowing economy. But remember, slowing does not mean crashing uh, or a recession. I kind of think I always like going back to the plane analogy, but I say this all the time that you we don't know what we know we're having is a slowing economy, right?
So, we're we're coming in for a slowed economy. Well, that could be a crash where, you know, we hit the ground and and the economy basically goes negative and then we climb out of that negative because, you know, the economy can climb out of a negative unlike a plane. or you have a soft landing where you know you come in it's almost like you touch and go then you take off again right we know we're on the declining growth phase will the Newton damage so to speak of April lead to more continued cutting we're just not going to know until June or July really you know because the Fed's going to wait for that data not just April data but May data how are people responding after April 12th April 12th Monday, yesterday morning is when we actually got the details of the China trade deal.
Okay. Well, how are people responding to that Chinese trade deal? Well, I don't know. When are we going to know retail sales for a full month after the Chinese trade deal? Well, technically, we're only going to get half of a month for May because the uh tariffs go down tomorrow on Wednesday. The tariffs get reduced.
So, you only get half of the month of retail sales data to understand how consumers are reacting. your first full month post tariff reduction won't actually be until June and so that June data won't come out until July and some of it won't come out until mid August which is why I maintain this idea that the Fed is going to be slow.
We probably should not expect a rate cut from the Federal Reserve until September. And in the meantime, trailing stops are an opportunity and we won't know if this is going to be a uh, you know, bare market rally or back to a bull market and everything is fine. Mind you, tariffs are higher than they've been since the 1930s, way higher than they were on January 1st.
And we don't exactly know what the damage of that is going to be. this idea that CPI prices this morning actually came in you know pretty well we beat by 0.1% on all except course core year-over-year which came in at a match but the components even super core was pretty reasonable somewhere around 2.4% 4% on an annualized basis.
These numbers are not bad. Now, does it make sense though that April CPI was lower? Sure. We technically had so much inventory front running in March that why would we expect a lot of inflation from inventory that we front ran in March? Because of April tariffs, we haven't gotten through that inventory yet.
So really, we won't see tariff impacts on even that 10% portion until we probably get through about 3 months of inventory. So April, May, June, which again puts us at July CPI, which doesn't come out until August. So I want to be crystal clear on this. And so I'm just going to write it down because I know people are like, "Oh, but cin whatever." There's always a weenie baby somewhere.
There's a weenie baby born every single day. But what I'd like to do is just make this crystal clear because that's my goal on this channel is just to give you my crystal clear opinion. Okay, my take is that by August we'll know recession or not. Okay, if no recession, we're probably higher for longer.
You know, this means if you're in real estate, hey, take advantage of the new 179 deduction uh for 100% accelerated depreciation through the new tax plan. That's what we're going to do at Houseack. We'll take advantage of that. We'll take advantage of ADUs. We'll take advantage of tax deductions on ADUs.
We'll take advantage of uh of, you know, potentially lending uh in the event that there we're we're in a soft landing environment. I think we will know by August. We've got some cool ideas coming for wedge lending that that are already in motion. Uh but in August, if we do end up in a recession, that's when you want to be prepared for the Fed pivot.
Uh and that's where a trailing stop could aid you because if we have recession uh you know via unemployment skyrocketing like we saw with the Microsoft 3% layoffs Nissan and these other companies uh by August again you know call it 5.2% unemployment and rising this would it seems less likely but it's possible uh then you're probably in an environment where you're going to want to wait until the Fed fully U-turns.
Now, it's interesting. It's going to be really fascinating to see what happens between now and then and what kind of momentum damage has been caused. But right now, the wealth effect is suggesting that no recession is more likely based on the market being bullish right now. Now, does that make me bullish?
Yeah, it makes me cautious. I don't mind waiting until August. In fact, I have exposure to a stock at's like 3x since I bought it. It's up 25% today and it's up 90% over the last 5 days. I last pitched it about a week ago uh in the Alpha Report. Uh but uh but but regardless, if you want to join that, go to meet Kevin.com.
Give it a 30-day trial. Try it out. If you like it, stick around. If you don't like it, you can always uh you can always pause your subscription. It's a click of a button. Uh that said, I'm very curious to see what ends up playing out. Uh, and I'm just going to keep providing data points where I can.
And we're going to be watching this on a daily basis, which I'm really excited about because I enjoy sharing this perspective with you and my ideas with you and uh hopefully you take something away from it and learn from it. So, this is what I'm watching. Let me know what you're watching in the comments down below. Thanks so much and we'll see you soon. .
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