Transcription
All right. So, it hit our level and it bounced off of it. The exact level that we went over in yesterday's video. The exact level we went over today for you guys publicly in the pre-market. And you can see there it is. Look at it.
Everyone was a little aggravated when I said, "Hey, I don't think you're going to rally here. I think you have some issues." And we'll get into what those issues are. And we're definitely going to get into what JP Morgan said, and you need to pay attention to this because it is a big deal. It's not a small deal. It's a big deal. And it could explain why we're seeing some volatility. And I just want to do this before we go any further because I think it's really important. 626. You still can't get over it. You're still rejecting. You can say it as much as you want, but rejection, rejection, rejection more times than me trying to get a hold of Jazelle over and over and over again. Right? So when you see this, you just need to stay out of the way. There's literally nothing for you to do except allow this to do what it's going to do. You're going into FOMC. You have Oracle Wednesday. You have AVGO on Thursday. As always, subscribe, click all notifications. Let's get to it.
Now, usually towards the end of the year, what starts to happen is people tend to hold their winners and then just sell the losers for tax purposes. And this can present some interesting opportunities. Now, you're going to see a lot of names that actually do this. You're starting to see these breakouts above some of these call walls, and we're seeing this over and over again. You're seeing it on a lot of names right now. They're the names you really want to focus on if you know where these things are. We go over a lot of them in the pre-market for you guys. We also go over a ton of them in these videos. So, you always want to mark them off if you don't know how to find them yourself um or don't have a service, whatever. But you want to know where some of these are because it does show you how they are positioning going into the end of the year. And you're seeing these moves where people are like, "Oh, this is outsized. What are we doing with certain resistance levels?" Like here, I'll walk you through where I'm going with this. Like, see how we can't break through that 626 that I explained yesterday and everyone had a heart attack in that video because I said, "I don't think you're getting through 626." And they all thought that meant stock market crash. No, it just means that you're in a stock picker market.
So, when you're in a market like this, you get a very low correlation. I I should do this really quickly. So, what's happening is you have a market that everyone's expecting to go up and then they want the market to go up so that their stock goes up with it. What they're not understanding is right now the market can go sideways to down and their stock can still go up because the correlation is off. So, in other words, you have a very low correlation to the market. meaning the market can go sideways and individual names can actually go up because you have a low correlation across the board. You're at one of the you're at a multi-year low correlation. And if you're if you're in the community, you know what I'm talking about. If you know if you if you've been following this stuff, you know what I'm talking about. You have high correlation markets where a rising tide lifts all boats. And you have low correlation markets where it doesn't. For example, if you take a look at something today like SATS, which we've been yammering on about forever, but if you take a look at this, you could see that huge move, right? because they're associated with rockets, SpaceX, etc. But then you look at something like ASTS and it can't even get out of its own way. But then Rocket Labs lips and then when Rocket Lab lips, it's because of what's happening with what? Well, SpaceX says we're probably going to go public at 1.5 bill trillion dollars, you know, whatever. I mean, it's going to be hard to evaluate that company, but okay.
So, let's go take a look at Google. Well, Google still making a lower low. Well, why? Well, Google's in a position here where they own 7% of SpaceX, and no one's even talking about it, but it's down. So you're not getting a rising tide lifts all boats. You're getting your winners and your losers. A lot of it has to do with tax planning. So when you see something like a grinding higher into the end of the year, people that are long this are not going, you know what I need to do? I need to pay more capital gains this year. So if you think about it that way, they're they're not going to sell that. So that's what you're starting to see these moves. And this allows us to do very simplistic things. And then we start looking at these kinds of movements. And you'll see them. you're setting up little flags like this set up a perfect like just absolute perfect, you know, rip and then dip and then gave us an excellent entry for a good day trade. Now, I'm not trying to catch all this. I don't need all this if I'm day trading. I just want to catch the meat as fast as possible and get out of the way. In other words, if this is the meat of the move that's in here versus waiting to get this that takes this long, I don't need that $8 that takes all day. Now, if I'm swinging it, it's a completely different story. But if I'm day trading, the meat of it was in the first half hour. And we were able to pull it off, actually get out of a lot of it, even before the jolts number here.
Take a look at this. Once you flip that 700, I think you can go. The question is, how do you play it? I would just buy stock. You're going to do it before 10:00. They're just waiting and then they're just going to rip this thing's face off. Bought a tank out that well, I'm gone. 69707. I think you're going to take out highs. That was a fast two bucks. Trimmed. All right. That's a resistance point. Trimmed. It's one of my resistance points. I still have 70% left. There it is. Up six. Trimmed. Yay. Up 10. Trimmed. Up 10. Leave the rest on. Where do we want the stop on this? My stop's going to be a trade under 713, which would give me $10 net on the whole thing. Don't print under 713. Don't do it. We were friends. We were having a good time. See, that's what happens. Can't trust anybody. Out 100%. Those kinds of trades are out there right now.
We had the Jolts jobs number and those jobs numbers show that there are more people that are looking for a job or rather there's more job openings than they thought and from that the market ripped. I do think that it warrants understanding that obviously this isn't going to be the beall end all. They're just not all going to do this just because of where they are. But if you start looking at some of these names and going, well, Meta, for example, if we went here and cleaned up all my nonsense and you start looking at this and saying, "Okay, well, here's Meta and let's find January to give you an example." And you drop January right where it is. You see how you're fighting that area. So, what's happening here is you're trying to understand is the average person going to sell or are they going to buy? Well, if we go back to that Jan level right in here, we're seeing that since it was under, once it went under, you had tech sellers. And then when you got above it, you had those people stop. See how it just stops right above it? Now, if I close under this, what do you think's going to happen? All the people that have tax losses, they're going to pile in again. So, this is something that you might consider looking at from a short perspective if it closes under that. I shorted that today. I only made like a couple bucks and then I closed it. Um, I was looking for something a little more powerful and I didn't get it.
Now, if you take a look at that line and you just see how you responded to it, you know, when you got near it, you could see how you acted. So, maybe we don't break it. Maybe they're gonna just it's going to act as a support level and we'll find out more tomorrow when we get into the FOMC and what you know itch is going to say and we'll go from there. But this is the kind of thing you want to start watching into the end of the year. You're going to see more of this as it gets tighter and tighter into it.
If you take a look at something like an Apple, you did have a call wall up here and you ran right into it completely rejected. But what happened? You backed off, but you're not like falling apart. Some of these names are going to be much weaker and you're going to be able to see that difference. If you go and take a look at something even like take a look at something like Microsoft and we'll go to here and click January, right? So we can see that those levels that's point of control. Let's clean all this off and let's do it this way. We don't confuse it. And we'll go to January. There it is. January 2nd. Yay. So when you got to that level, and you didn't get there exactly, but when you got down to that year-to- date level in there, you could see that, hey, when we had that big move down, people were like, "No, no, I I I want to own this. This is my average cost. I'm not selling it. I don't need to take the loss." That's important to mark these levels off.
So, one of the things that I like doing a lot with names, especially if they're down, is just running through them and looking at those year-to- date levels and you just click on it and just take a look at where you're at. You know, this is one of the times when it's really important to look at that because you'll understand like, well, why would that be running into the end of the year? Well, the average person that's in that, the volume weighted average person that's in this trade, right? Volume weighted average price. They're average. They're they're looking at this going, "Well, why why in the world would I sell this? I have a capital gains in it. The average person's actually up in this trade. Now, you might say that doesn't make any sense because you're looking at it from like well from January people were down from 155 to here. But no one cares because that's not where they own it. The average person weighted average owns this at roughly what it's like 90 bucks. Okay, that's how you want to look at it. It's not stocks that are down on the year. One of the things that people do the worst of is look at the stuff and say, "Oh, whatever's down on the year, that's the one that I should be getting out of or that's the one that people are going to sell going into the end of the year." No, it's where's the volume weighted and then where are those people positioned. There is a huge difference between what the media tells you are the names that are going to be sold and what names are not going to be sold.
If you look at something like a Nvidia, for example, and we study this and just go and take a look and drop the 25, and we'll get to this in a second here, but watch. If we drop just dropped the 25, you're nowhere near it. Like you're just you're just not. So there's these kinds of names like, yeah, they're up, but you're also nowhere near it. So if we were up on the year, but we were not here, right? And and you were under it, I would expect even being up that you're going to have an issue. And I do think that that's really important for people to get because that's the difference going into the end of the year. super important to get that especially around option expiration because those are the people that are hedging and that's again sup I think super important out of things that are setting ourselves up.
If we take a look at Oracle for example we're just going to just go here I'm going to drop this down because this is pretty dead uh there's a lot of call still by market makers at the 20 but you're sitting in here and you're getting ready for earnings I do think it's worth noting that Oracle in and of itself was at 340 um and for some reason everyone has made a decision that the earnings are going to be a disaster capex for Open AI is going to go to zero apparently and Oracle is going to do something it's never done in its company's history and default on bonds. Somehow people have convinced themselves of that from September 10th all the way to Tuesday, November, you know, 25th. Um, okay. Or maybe they just beat earnings again and they leave guidance alone and say even if Open AI can't come up with the$1 trillion dollars uh that it's supposed to and capex we have a litany of people that want to do business with us and the stock rips everybody's face off. But that's just what I think. You should do what you're comfortable with. You know, you never know how this stuff's going to play out. But I do find it super interesting and I can't remember I truly was thinking about this. I cannot remember another time where we were trading in a bull market where this thing got smoked like this within this period of time between quarters and you're in a bull market. Like there's been periods obviously like in here where you've had earnings and then the next quarter you're down. I'll show you what I mean by this. So like here you are and here's earnings. So here's the earnings and then it's it's just a rip, right? And then from this one it's you're down to here and that's a 30% drop, right? And that is enormous. That is not really in a bull market, is it? Right? Like that was the high of the market. So then if we go here and go, well, was that the high of the market? Well, clearly not because the market's done better since then. But you look at this and realize that you're down 46%. So you've corrected about 50% on a stock that hasn't missed earnings, that hasn't lowered guidance. It's done nothing. It's very, very different than when, you know, the Fed said, "Hey, by the way, those JPEGs that you're calling NFTTS, yeah, they're going to have to go back and be called JPEGs again. Sorry about that, guys." Um, I'm sorry about inflating the housing market, but you know, anyway. So, you have that kind of stuff there, but if you start to look at the chart just over time, it's you're not going to see it. If you start going through it, you look at the earnings dates, you're not going to find a period where you did anything remotely like this. And I'm talking about going back for years where you just, hey, you had awesome earnings, you have a bull market, and this thing got cut by 50%. So, I think people are really out of position here.
If you look at the market, I'll just tell you where like the option market makers are. You had a call wall at 215. It's up at 250 now. That's what they think. You know, you should do what you're comfortable with. You never You never know, guys. You never know what's really going to happen with earnings. But I find it interesting that they raised the call wall. Um, all the options have gone out much further. That is a bullish indication of activity of what the market makers are doing. Right or wrong, that's what they're doing.
If we look at AVGO, which comes out after that, uh you have another close at highs. I do think that it's super important and that this is something that you guys can learn to do. We'll clean this off. Um, your call was 400. Obviously, they're going to raise it. But here's what's so interesting about this. If you look at 400 and you total both the puts and the calls, it will give you the implied volatility move. And I I'll show you what I mean by this. Now, what I'll use is I'll use 405 since you're closer to 405 strike. Now, this is the strike right now. 405. These are your calls and these are your puts. Puts, right? And these are all just different numbers, but that talk about the open volume and everything else, option interest, volume, whatever. But this is your bid and your ask and this is your bid and your ask. All right, so just pay attention to the bid and the ask. So if you went looked at 405, you would just very simply go 405. And this is how you figure out how they where they think it could go. So then you just go plus 15, which is where the call is right here. Stay with me. And then you would just go and take a look over here and go, okay, that's at 1350. So to make it simple, we're just going to call it 14 since the stock's already at 406 anyway, not 405. And then just go there, and this is going to give you an understanding of where you're at. So that's 30 times where you're at. So that's going to put you roughly at what? 435, right? So it's actually, you know, 434, but you get it. So I think that's really important to get because once you get that and you understand that, then you're going to go, "Oh, well that's why they're selling those calls." So when you understand where the implied volatility is, not that you guys are going to be like crazy option sellers, but if you understand that, then you're like, "Oh, okay. So that means that the market makers at 430, you know, they're they're out there." All right. Well, that would also mean that you take the other side of that and take down 30 points from wherever closes and that's where they're going to be selling puts because they don't think it's going to break that either. And then that would be kind of how they do their strangle, right? All right. So, but super important concept. Um, but if you look at these names, this team's acting fantastic. Now, what happens after Oracle is going to be very, very interesting. But I do think AVgo could also have the ability to lift uh Google with it.
Google really didn't move as much on the news about SpaceX coming out and saying next year uh that towards the end of next year, it looks like on the Dallas exchange uh they want to come out at like a $1.5 trillion valuation. And that's obviously why SATS did what it did. I don't know why that's doing that today. I'm not going to have time to edit all this. Uh SATS did what it did. You know why that's ripping. Um, and so you have other names that have stakes in it, but the bigger names. Yep. I think there's a Baron's fund uh that these guys in the room buy. Let me see if I can get the symbol on that. These guys, I don't own this, but there's guys that have been in this thing for like ever. Um, it's done very well. I mean, candidly, if you go and take a look at it, um, and they've been in this thing forever, and they've done exceptionally well with it. You know, obviously the thing's probably going to rocket when the day that there's a little joke for you. Rocket on SpaceX. Get it? So, you know, I do think that some of this stuff like Rocket Labs is something else that we've been buying and doing very well with uh recently, but I don't think people are truly getting that you are seeing rotation in the different sectors. We mentioned this about a week ago. You're seeing that in the robo ARC Q. Someone actually brought ARC Q up in the public pre-market, which I always tell people to watch because there's a lot going on in these public pre-markets. You know, there's more than I can cover. Um, and you know, every get everybody's ideas.
So, and that leads you to where you are with Tesla. Uh, one of the things from last night's video that I was pretty vocal about was that 435 level and that it was probably going to hold. I use a lot of the RSI in the 15 and you know, it was one of the things I was saying like, "Hey, when this this thing's only been here like six or seven times during the year, I don't even think it's been that many." And if you go and drop a pin, so if you ever have a scenario, instead of you telling it what it's going to do, what you do is you go look at back data and you're like, "Hey, when it when it got here before, what did it do? Did it do anything close to what I think it's going to do? Right? And so you just kind of mark these areas off and then see if it does anything remotely like that. And you you'll find great value in that. Right? So anyway, um, you can see how it dropped, bounced, dropped, bounced, dropped, bounced. Right? Here's another one. Look, dropped, bounced, dropped, bounced. Oh my god, it's a miracle. A Christmas miracle. Look, it dropped and it bounced. Who would have thought? I don't know. Maybe somebody that did the work and went back through 2025 and saw that it did it every single time, right? That's why. So, it's not rocket science, guys. When you don't know why something's going to do something or what's going to happen next, go look at something historic, especially if you have an extreme move like this, and then go and take a look at the chart and then make a determination on what happened during that period of time, and it's going to give you a higher degree probability versus the guy that's on Twitter that's eating hot pockets in his mom's basement.
All right. Okay, cool. Things that make me bothered because you asked. I don't like the VIX right now. It's I find it vexing. So going into the end of the year, higher high on the VIX going into itchy tomorrow, his speech, we get the dot plot, too. Remember the dot plot tells us from 26, 27, and 28 what they're going to do. I think that's super super important for us to get. Um, so we're going to get that dot plot tomorrow. Then he's going to explain the dot plot. Then he's going to explain how he's going to tell that rates are going to do what they're going to do without us getting a PPI data. Okay. And then if we take a look at move as well, I don't like this at all. There are things that I've liked in my life. This is not one of them. So, we came back down here on move and you see how it's rallying and rallying and rallying. It's not good. We don't want them buying bond insurance into tomorrow. We don't want them doing things like that, you know.
And a lot of this stem from JP Morgan today, which had a really bad day. It was actually, you know, this actually was just really ugly. Um, we caught it. I actually caught it through one of my screens. Um, and then one of the guys in the room like pointed it out at this bar and I'm like, JP Morgan doesn't do this. like it. You very rarely will you find a chart where JP Morgan is doing this. And really what happened is if you go and take a look from here to here, you're down 20 points on JP Morgan. Uh their credit card reserves are an absolute dumpster fire. Now, what are they going to do about that? They're going to increase them, but the consumer, you know, some ends of the consumer, they have to raise that. I think they were looking at like, someone can comment on this, but they're in the high 3s now, which is way over where they thought they were going to be from where I looked at it. They said this at a Goldman conference today and it wasn't on the tape and so like if you don't you know have the news when the news comes out it's really hard to see this until later but uh it was on the tape but you had to have like direct access to Reuters and then from there then it goes out and then it was processed and then CNBC picks it up. So when it was dropping people have no idea. That's why people always say to me why do you spend so much you know money on information because I spend a lot on research a lot. A lot on research and a lot on data feeds. um way more than most people probably think that I do.
So what you're seeing here is you're just straight out selling. Tries to rally, gives you a little pendant. I actually bought this and made a little bit of money. I tried again. That wasn't so good. Uh and so to me, it's JP Morgan. You know, it should bounce. But what you always have to be careful of these kinds of charts is, you know, I'm not going to be a hoper and a dreamer. I I've I've done this for x amount of years, like 27 years. I I know hoping and dreaming that that's going to bounce is just got disaster written all over it. So, um, you always when you have these days, you always get that secondary bounce and then you'll start looking for it. You'll see them. And so, what you're doing on those reversals is just let them just let them die. Just let the whole thing burn and then you get to pick it up even cheaper. Isn't that better? I mean, if you really want to own the company, then you want it as cheap as possible. But that's a concern of mine. Like to smoke JP Morgan like that on that kind of news on the credit reserves that they came out with at Goldman. And what I couldn't figure out, you're going to tell me that they're going to have a problem, but Alli is fine. Visa has nothing to worry about. Capital One's good. That makes like that makes no sense. Like it makes zero sense to anybody that understands finance, you know, that the consumer finance makes zero sense because JP Morgan is very very conservative about who they give cards to, etc., etc. So, I thought that was interesting and that's a concern. So, you know, as much as people don't like to hear when I have concerns, for some reason, they just want to hear that everything's going to be rosy and everything's going to be okay. It's not. Um, you actually have to do your work.
So again, that 626, you couldn't break it. You know, we mentioned that yesterday. Go take a look at the spy. Still sitting here. And you're still sitting at that point of control. Just a real quick refresher for you guys. You can see where that is here. You can see where that point of control is. Same thing, same levels we went over earlier. We have to get through itchy. After we get through itchy, then we have to get through Oracle.