Liquidity Rotation Tracker | Semis vs Everything Else

Added: 2026-05-12

[00:00:00]Bull markets tend to die on great news.

[00:00:03]Bare markets tend to end on really bad news. But this is what a buying panic looks like. S&P cost is at an all-time high, meaning everyone in their cousin is chasing upside via calls while no one has any downside protection. Now that we're seeing these semiconductors really have these blowoff moves, notice what's actually responding more favorably. Is it the anchors in the space like Nvidia, or is it the junk in the space? And I can tell you unequivocally it's the jump. The semiconductor stocks are now trading at 63% above their 200 day moving average. The largest margin since the do bubble burst. Semiconductor stocks are now the most overbought since the 2000.com bubble. Period.

[00:00:45]>> This financial education content is brought to you by 7th Financial.

[00:00:51]>> IGV has had a decent move.

[00:00:53]>> So at least it's not losing ground. No, >> but it's like a very slow drift.

[00:00:57]Absolutely. I still have quite a bit of confidence that we will rather than seeing a cascading crash of all markets lower. I think that inevitably we'll see a a cool off in semiconductors and the liquidity that's chasing those dozen or so names will rotate into different sectors. I know that Gary's had a couple good calls in aerospace. So, it doesn't necessarily have to be a software catchup. We could absolutely see uh a bit in healthc care or we could see defensive stocks pulling their bootstrings up a bit or it could continue along the lines of speculative froth. Right? You could see some of the other kind of speculative sectors really benefit from this rally. But so far it is largely a waiting game other than silver having a pretty strong pump today. I'm watching carefully to see whether gold will confirm that move. I'd like to see ideally gold pop back up to what about 4,800 is sort of the level to gain to confirm the move I'm seeing in silver and or a breakdown in the DXY.

[00:02:07]The DXY has been just very stubbornly clinging to kind of a 98 level. But for the most part, it's kind of just trying to wait as patiently as possible. My approach right or wrong continues to be a tactically play for a bit of a a pullback a reversion to mean to look at a couple of the single names that might benefit from a rotational rally if we were to get one and to mostly just stay agile, let the market paint whatever tape we're going to get.

[00:02:42]>> Yeah, I like it. We were fortunate last night we had a good showing in our elite group and just to share a little bit I'm not going to divulge all those charts because it would take us two to three hours to go through that plus the general stuff we need to get through but one of the themes that we talked about and it's one that perhaps if we get a pullback you were mentioning areas of the market that just have diverged radically from the momentum names. You mentioned healthcare. We've obviously talked software. One of the things that was a real theme in last night's elite discussion was around materials. That's going to be something that if we get some type of corrective in the market as a whole, those are going to be pockets of value there. I would also argue within the material space, one can look at more specifically the gold and silver mining complex. So, they've cooled off dramatically. They're priced pretty well. their relative PE ratios are in line with what you would expect really if gold and silver were marketkedly higher. So, I like that as a long-term play, but it kind of echoing what you said last night. It doesn't mean that precious metals wouldn't come in in a riskoff environment, but I still like the play and I still think it's a great long-term thesis, especially for those of us that are not traders. You know, we have a lot of people here that trade actively. We have a lot of people that don't trade actively. So for you that are looking more long-term at your portfolio, I would just encourage you to look at real assets and those companies that either source or mine real assets because that's going to be what the race is into the next decade. So that's kind of the theme we discussed last night.

[00:04:18]One of the things too, you mentioned something really key is when the semis cool off. I agree with you. I think we're getting very close. I'm starting to actually hear chatter amongst people in my own circle like, "Hey, have you bought any Micron? Have you bought any Intel?" When I start to hear that chatter from people that aren't watching markets daily, it tells me we're close at least at a minimum to a pullback. And if we get it, what we're hoping for, if you're bullish, you're hoping for that rotational element that we keep bringing to the forefront each and every time.

[00:04:51]Damian, you had spoken to me earlier about this. It feels like we're a bit of a broken record because there's nothing new to report until something actually breaks and happens. But at least most here should know exactly what our mindset is going into the next few days.

[00:05:08]And I'll also mention this, we're always looking for some type of trigger event to create something, whether it be a pause or a corrective and semis or some type of rotational play in other areas of the market that are more depressed. I think tomorrow's CPI data will be a real interesting print and I think it could be something that could finally get the market to get off of this just momentum chase. My suspicion and I again I'm just you know I don't have a crystal ball but a lot of the PPI and CPI reports that we've seen over the last month two months they haven't really had the filter through of all the energy shock and I got to believe that we're going to have a hot print tomorrow and we'll see how the market responds. It has not responded negatively to anything regarding war or energy prices. It has just taken it and water on a duck's back let it roll off. So the question is, if we start to see that data filter through and inflationary pressure start to mount, does that take the steam out of this current rally? And if it does, do we see those plays that we've been talking about for days, if not weeks, start to finally materialize? So that'll be the real thing. I really think that and the other one is Ging. You know, we don't talk a lot about geopolitics, although we probably should incorporate a little bit of it. But I would be really interested to see how that meeting with Trump and Gigi Ping goes because there's a lot there that we could probably talk about even on a fireside chat that would occupy the majority of the time. But there's a lot of strain going on geopolitically.

[00:06:38]And you know, I know with the rhetoric that we hear in the states, regardless of what side of the aisle that you fall on, whether it be the left, the right, or somewhere in between, the reality is everything that we hear is not the whole story. And you had mentioned it to me before. I kind of wanted you to echo some of the things that you said to me, to the group in terms of how the markets have been jawbone higher through every false news narrative or real news narrative that came out. Is there a way that you could verbalize that just to kind of I know most people know what I'm talking about and I know you do. It seems like the Trump administration's done a great job at massaging if not somewhat encouraging markets through their news feed, >> right? Yeah. So, you know, as we saw in the summer of 25, it's the same kind of playbook. How should I put this? So the narrative from the White House and then propagated through mainstream media has been very much the geopolitical concerns, right? And so it is a wall of worry that then forces market participants the serious ones like institutions stuff. You have to respect the downside risk and therefore you have to have hedges in place in case there is some kind of big spill some kind of big scary news that we're back to boots on the ground or that we're escalating not negotiating peace. And so therefore, via this constant job owning back and forth of like we've got a deal, there's no deal. You know, we can we think we can work with Iran. Oh, they're super bad guys. Oh, this is and it's the job owning back and forth. It is a constant and reoccurring wall of worry and you see markets systemically climb higher and it is a narrow breadth narrow participation forcing the the opposite sides of all the the call options to be covered by the dealers that are providing liquidity. So therefore it kind of just steps up that supportive underpinning level and it is the wall of worry that we've climbed up and so you have to then wonder whether this sort of sky is falling right where it's like if enough times and then there is actual bad news and nobody believes it and then it just spills right that could be a potential outcome where you squeezed out all the shorts Now, nobody is really properly hedged and you see an outsized move down. Not a necessarily a cascading crash, but you see an outsized, you know, 3% move all in one day because you've kind of created this very instable top based on the news narratives. And nobody was believing that, you know, like why would this week be the week after five consecutive weeks of like no war, no ceasefire, just, you know, the status quo. Equally, if we were to finally see a resolution that provides some clarity and at least a time frame where we were to believe there'll be no escalation for 30, 60, 90 days, a year, 5 years, whatever. You could almost write the story as like, okay, but it's priced in right now. it's effectively priced in and everybody thinks it's go time and it rolls over on itself or it finally sees a correction, right? It's like everybody's ready to get long and then we see the correction is like the war is over and the correction. So, we've seen these type of setups in the past. It's very difficult. I mean, impossible really to know how it plays off, but I would speak to the obvious and very deliberate nature of the news cycle and the narrative. And it's not just markets. I don't want to come out here and say like, hey, it's all about markets. It's equally to qualm kind of the general populace, right? is like, hey, war is unpopular, but if we jawbone back and forth enough where we're projecting like we're not the aggressors, we're, you know, we're acting responsive. This is a humanitarian effort. Kind of the back and forth, you're able to massage or at least to desensitize, right? The citizens >> as far as what's actually happening. We should all be just as upset about why, how long, what's the plan, what's this resolution. We should all be just as upset today as we were two months ago. But that's not the general consensus. And I think a lot of that is just due to the perception management, right, from central parties, from the White House, from news media. And so I think that it's two parts markets, one part general population politics of the matter, you know, international politics, domestic politics, right? Or maybe it's two parts international politics and one part markets, but it's obviously been used as a tool to influence the outcomes. And so I think it's worth recognizing kind of where we're at. It's like it's a chase, you know, it's not a broad participation.

[00:12:14]It's been largely mechanical. It's not a full green light. We're at levels where I think that the longer we find acceptance within these ranges, then the more and more this looks a bit like last summer, right?

[00:12:30]>> Yeah. But if at any point we lose our footing and we spill, then we have to be mindful of like, okay, where does the intervention catch us? Do we hold the primary volume shelf that's a half dozen points below? If we do, then it is very constructive for markets that there's a bid, that there's underlying support, that that's a pullback worth buying the dip. If we see that structurally this very precarious very narrow rally if structurally we see a collapse and that there isn't a bid and that there isn't rotation that it is just kind of an escalating escalator right lower then that's where we need to really pay attention and risk manage but I think that the prior is a much more likely outcome than the latter. I think there's a lot of very large players including the Treasury and the Fed that are going to want to keep some level of stability. I think there'll be a bid as we've seen.

[00:13:37]There'll be liquidity provided that kind of keeps the casino going. So, those are the type of things that I'm watching for. I'm personally feeling a bit of FOMO on commodities and silver because really thought there'd be a bit more of a pullback. So, it's the question is always like how aggressive to go after the shallow pullbacks, you know, how much patience to to manage into those positions. I I feel like I've got my first bite at the apple, but not nearly as much exposure as I'd like.

[00:14:14]if we are going to ramp up and and if we do see that the rotation isn't into things like software and paper assets, but it is it's like time to see and and silver and like the miners start to catch a bid. So, got to be mindful of some of those signals as well. If we start to see that action, then I think it's time to come out here and pound the table and say, "Hey, if you think that the semiconductor rally was a big deal, then some of that same momentum and froth could be now chasing precious metals or now chasing other elements of the commodities sector. there's a lot of room to run and we know that the energy story is potentially going to be a tailwind to at least the commodities, right? Not necessarily onetoone with precious metals. I would think that if we're going to see a big bump in precious metals, then maybe the tailwind would actually be oil coming in a bit.

[00:15:13]But if earnings and projected earnings matter, then that would be extremely favorable to the miners. If however we continue to see some of the supply shortages in things like fertilizer like that seems highly predictive of a future increased cost to agricultural and to some of your like you know beef futures and stuff.

[00:15:36]>> Oh yeah.

[00:15:37]>> Before we go further, quick word on what we do inside 7th key Financial. What you're watching right now is just one piece of it. Inside the member platform, you get live access to Josh Taylor's daily market updates, interactive video live streams, including Monday market reports, Wednesday fireside chats, Friday weekly wraps, Sunday webinars, swing trader analysis and positioning, daily markets analysis at the halfway point of open. That's structured market coverage every single day, every single week with roundthe-clock access. You also get beginner through advanced courses, live trading chats, community access, and at the higher tiers, trade calls across equities, commodities, Bitcoin, altcoins, not to mention one-on-one portfolio review sessions with Josh Taylor, NSSA, BFA. It's a full trading and investing education platform, not a Discord server, not a newsletter, where you can build your membership the way it suits you. Right now, YouTube viewers get 30% off. That's 30% off their first month across all membership tiers. Use code meat of the move at checkout. That's meat of the move all in one word. Links in the description. Cancel anytime. All right, back to it.

[00:16:43]>> Cocoa, wheat, corn. You know, we've talked about soft commodities before.

[00:16:48]That's going to be a current theme for us going forward. You know, again, these are longer term trajectory plays, and it's things that a lot of I hate to say it, but traditional portfolios are not exposed to. Most portfolio managers, if you're working with a financial advisor at all, they're usually doing a traditional 60/40 model where you got 60% stock or 40% fixed income. The reality is you're going to have to start getting exposure to other alternative asset classes in order to keep the trajectory on the positive side for you and the longer term growth of your portfolio. And the other part is too inflation. If you're trying to keep up with inflation, I know a lot of people will harp on the idea of stocks being a good play. There's some merit to that, but it's the type of inflation that you get. How violent is it? Is it something that's going to curb consumer spending?

[00:17:38]And right now it is. I know a lot of things that I've posted on platform, I've seen on certain media outlets. I think it was the CEO of Hines that came out the other day and said consumers are running out of money at the end of the month. And we're talking about the bottom half, right? Well, that hasn't mattered for the stock market because we are in a K-shaped recovery, meaning we're seeing the top 10 or 20% garner the fruits of all this money printing and all of this loose monetary and fiscal policy, whereas the bottom half is just truly struggling. And that goes to the heart of why sentiment is still very sour. One thing too, and this is before we get into some charts because we have some charts that'll really line up perfectly with your commentary.

[00:18:20]I want to reiterate some things that you and I have talked about before, but I also want to reiterate some finer points of things that we often forget that are elementary on the surface, but are sometimes hard to grasp in the moment.

[00:18:34]Bull markets tend to die on great news.

[00:18:38]Bare markets tend to end on really bad news. You had mentioned something that really kind of struck a chord with me is what if we did get resolution in the Middle East? What if we did see oil come in 10, 15, 20%. What if we did get a just a flurry of really good news?

[00:18:54]Wouldn't it be something if that actually signified a market turning point? The other thing is too, and this is something that's really important.

[00:19:02]You had mentioned to me we have a running conference call, Damian and I, every Monday morning. pretty early for him, not so early for me being where we're located in the country. But one thing that you made a keen observation on is that the headline indices, namely the things like the S&P 500 that we study from a technical perspective, can stay pinned a lot longer if the rotation happens to come into the form of software. So you can actually see dramatic correctives in some of these stocks that are momentum chased names.

[00:19:33]But the powers that be know exactly how to gamify this market because of the waiting of a lot of these components. So it's it's really, you know, one of the things that I often sometimes lean into too heavily and I'm guilty of doing that is being a little bit more on the bearish side of things because we are stretched valuation wise. We're stretched as we've ever been, but it hasn't mattered. You're going to see some other things that that haven't mattered here in a few. But my point being is for you said perception management.

[00:20:08]>> Nice.

[00:20:09]>> Perception management is that person that gets in at the end of their workday and they're reading the paper and I know no one does that anymore. They're picking up their iPhone and checking out the latest news reports. Oh, the NASDAQ closed up a half a percent today. The S&P was up 20 points. See, as long as that perception management's there and people aren't actively taking a role in their portfolio, they really don't care.

[00:20:28]And as long as the powers that be can pull levers and push buttons that create the illusion that hey everything is okay. Don't worry about the private credit woes. Don't worry about commercial real estate. You really don't need to worry about what China and Russia are potentially planning maybe with an escalation in Ukraine or perhaps China with Taiwan. Don't worry about all that. So it's kind of like give them bread and circus kind of mentality. But that is the reality and that is where we find ourselves. At the end of the day, it really doesn't matter how much we prognosticate about it. It really matters, are we making money? And what we're trying desperately to do here is identify where we can make money, not be so dogmatically biased in one direction or the other. Because if you get into that, and I'm guilty of it, saying this is this feels a lot like 1929 or it looks a lot like 2000, then everybody anticipates a big 50 60 70% collapse.

[00:21:25]and it doesn't materialize, then you're looked upon like, uh, JT, you kind of messed that up. So, I want to make sure that we're crystal clear here. While I do believe that the macro backdrop matters, I think in the here and now, we're forced to deal with the mechanics of the market. Be that as it may, we're forced to deal with momentum chasing and we're really forced to deal with what Warren Buffett put best. We're not dealing with mature investors. We're dealing with a casinoification of markets right now. You had a really great interview. if you get a chance. I put a lot of stock in, no pun intended, I put a lot of stock in what someone like Warren Buffett says. He might be in his 90s and he might be a little past his prime, but someone like that, you never fade. You always want to take to heart what the Wizards of Wall Street have said in the past. And this time isn't different. Even though it feels that way, and even though it can go longer than you and I even could possibly imagine, you just have to have one foot ready to leave in the event that things got a little bit more dynamic. But for right now, I'm in your camp, Damian. As a matter of fact, I think some of the technicals, if we did get a pullback, would suggest more of a shallow variety now that we've broken out of several channels, be it the NASDAQ or the S&P. But guess what? Do we throw those channels and technicals away that are our roadmap? No. As a matter of fact, we'll look at them in our rearview mirror so that if we do come in, those will be areas where we want to find support and establish support where we often talk in terms of if you break out, okay, this is technical jargon here, but if you break out of a resistance, a lot of times if you're in a bullish regime, you'll back test that point of breakout to firm it up as a floor. And if you do that and you hold it, that makes the idea of a bullish case that much more powerful and possibly that much more of a reality. And you guys have already seen we put out multiple maps and we'll look at it again today, Damian, as to what could still transpire in the S&P going higher than even I had suspected just six months ago. So you got to be nimble, you got to be water, you got to be flexible. Let me ask you, do markets move? Yes, that's a obvious question to answer. If you cannot be willing to move with them, then you're not going to be able to play the market for what it is.

[00:23:34]You're going to be trying to play it for what you want it to be, and you'll do so to your detriment and unfortunately to your loss. So, in spite of my bearish musings and in spite of the backdrop that is still marketkedly more bearish than people are leading you to believe, it doesn't matter because at the end of the day, it's all about making money.

[00:23:52]And if we come out here and we just are constantly like pounding the table, this is not different. We're going to see a 50% collapse. We're only doing our community members a disservice. Do I think semis have come way too far too fast? Absolutely. You're going to see that when I share some charts, but that doesn't mean that other names like you just mentioned can't go higher. As a matter of fact, not to, you know, pound her chest, but we have got a few names out there that we've been putting out on platform that are starting to respond favorably. I've got great community members here. Damian, you know them very well. We talk about Gary often. One of the things that's really unique about our platform is it's a cross-pollination of ideas and it's also a cross-pollination of stocks and commodities and cryptos and things of that nature that are coming to the forefront by not just you or me, but by some really talented and very smart individuals. So, just really thank everybody for that. Want to mention something about crypto before we get started because we are going to look at the Bitcoin price chart today because I know a lot of people are kind of curious about it because we have had some momentum in the in the Bitcoin price chart even in some notable alts. Just in case I don't mention it, 82.6K is what we're looking for on a couple of day closes over that. If we get over that then 87 to 89 and there's a level up to 91. But you'll see there is the off chance that we could do that. I think as of this recording here we are a half an hour before the closing bell in traditional markets but as I'm looking at it now it keeps getting rejected at that 82.6 six. So, we'll continue to monitor it, but if it breaks, that could be give you another leg higher. And to mention something, too, that will happen this week. I believe legislation is being deliberated on with the Clarity Act, which I believe is for Thursday. There's still a lot of sticking points. A lot of banking associations are pushing back on the stable coins. There's still some issues with regards to the ethical part of the legislation, but I personally believe, and again, don't don't shoot the messenger, and I was going to get your take on this, Damian. I think in some form or fashion, whether it's watered down or not, I think the politicians are going to push something through with the Clarity Act. And if they did, that might be the impetus for that little bit of a pop on the news if it were to pass. And it just depends on what form it takes. But I would caution one thing about that.

[00:26:07]Just like we've heard before in many of the rumors that you've heard from some of the old Wall Street sages, you know, buy the rumor, sell the news. It would not be shocking at all to see Bitcoin make a market move higher on the passage of such legislation only to see it roll over the following week. So that's why because we still have cyclical things that are headwinds to Bitcoin right now.

[00:26:28]Speaking of Bitcoin, I'll leave you to answer or comment on crypto. I'm hearing a lot of big players talking about with the passage of this legislation, how many hundreds of billions, if not trillions of dollars will enter into the market space. I don't know if they're just trying to create exit liquidity, but it just seems like so much rhetoric around it. I won't mention names, but you can if I did mention them, you would know the people that I'm referring to.

[00:26:53]It's almost like they're trying to promote the passage of the legislation for their own personal interest and profit. And that's fine. I understand that. I see that all the time whether it's Bloomberg, Fox Business, CNBC here in the States where people are preaching their book. You know, that's kind of the way that people unfortunately are. But what say you about crypto here now?

[00:27:11]Because I I do believe crypto still matters. Even if you're not involved in the cryptocurrency space as an investor, a trader, I think there's a lot of signs and breadcrumbs that crypto will leave behind to tell market participants in the traditional markets exactly what's going on. But let's say you in the next two minutes before we get into charts.

[00:27:31]>> Yeah, it's a tough read because there's obviously a lot of work to be done to establish digital assets as a real centerpiece of financial plumbing. And so obviously you can kind of take the news narratives and manipulate them to suit your personal bias and narrative.

[00:27:54]The reality I would say is that it's not the price is not indicative of the fundamentals.

[00:28:03]We're in a period right now where you can mostly equate crypto and Bitcoin with software.

[00:28:12]>> Yeah, >> they're tracking one to one. Both are pretty bearish on your higher time frames. And so in order to invalidate that, we need like some real momentum to start breaking upwards. Uh you know, my thesis is that there is going to be a catch-up trade. But if if that's incorrect, if the rotation that is presumably coming is not going to benefit software, that it's going to benefit other sectors like commodities or energy or healthcare or you know, insert here, then I I I don't think that you're going to see much of a bid in in digital asset space in Bitcoin either. I think if it's going to manifest >> that it will be a bid in software and it will be a bid in Bitcoin and that there will be some type of exciting news or some sort of very front and center positivity and optimism >> why is pumping but honestly there are a lot of software companies that have been reporting and I'm pretty suspect of corporate accounting I think that it's pretty easy to cook the books nowaday. There's not a whole lot of oversight, but >> funny how that works.

[00:29:31]>> There are exceptions, but there have been quite a few recent software companies in their earnings reports, very favorable metrics, very favorable earnings and forward guidance, and there's no response as far as their prices. So you're seeing a real divergence in anything that the semiconductor names say during earnings is just pumping the price exponentially and software reports similarly productive forward guidance good numbers and it sells off. So it's I don't think that it's a fundamentals we've been kind of pounding the table for a while. We're not in a fundamentals matters type phase and markets. So I think that if we see capital rotate into digital assets, it will probably be handinhand with software in equities catching a bid.

[00:30:27]>> And I agree 100% there'll be some type of exciting news or optimism or a little bit of boost in participation in social media and media coverage to explain why we're seeing a pump. But I think it's as simple as will we see a broader rotation or nay.

[00:30:47]>> I like it. That's a great segue for us to do some charts. Real quick brief announcement. We're hoping this Wednesday will be uh the start of something really nice. If you're into crypto, especially we have a good friend of ours that you've seen here before share. A lot of you guys like his work.

[00:31:04]We're hopeful and prayerful that Tony Sabrino will be joining us on a reoccurring basis uh on Wednesdays. So, if you like crypto and you're into that thing, I'm telling you, that's his kind of wheelhouse. He's a technician. He's a great guy. I like his work. I respect it. He's very quick to let you know when something goes wrong or goes against them. But he's always quick to give you every bit of the unadulterated truth when it comes to the true charts and what they're screaming and what they're telegraphing to market participants as opposed to just luring people in for clickbait. So, we're excited to see if he can join us this Wednesday. That's going to be awesome. Hopefully that'll be something that happens on a reoccurring basis. Lastly, I did place on the news corner, if you would do me a favor, Lance Roberts from Real Investment Advisors. I like him a lot. I don't find him to be anything but a realist. You might find him to be a little bit more bullishly based. Partly because of what I've told you guys as a best practice for me. If I'm tilted towards a bearish stance, I always focus on reading two bullish articles. If I'm focused on a bullish stance, I'll try to read two bearish articles. I posted a really good one from Lance Roberts. I would highly encourage you. It takes you seven minutes to read it. It's regarding the current setup in the semiconductor space. And even him being bullishly biased on the market still believes that this time isn't different. There's a lot of things that are happening, especially in that particular sector where it's a lot of the bottom portion of the market in that sector that's actually exploding higher and not some of the more quality driven names. And that's usually late cycle type of movement. So again, it's not coming from me. It's not coming from Mr. Brown. It's coming from someone that should be a pretty highly respected individual in the space because he's had 30 plus years of experience doing it. So collectively, if you get a chance, check it out. So we put this out on platform.

[00:32:50]This is by way of Goldman Sachs. I just happen to clip it from Zero Hedge, but I'm just going to read it verbatim. But this is what a buying panic looks like.

[00:32:58]S&P call skew. Remember, we talk about skew and SDX and all PCE all the time, but S&P call skew is at an all-time high, meaning everyone in their cousin is chasing upside via calls and also behind spot up ball up while no one has any downside protection. And when you start to see these jaws widen like that, okay, I'm going to point one little point in time out that you will probably all recognize. Okay, the most extreme I could find was right here. And I'm just going to do this really quickly for us.

[00:33:31]I'm going to make that red for you. That particular area or those jaws right there. Guess when that was. That was right before our corrective going into March.

[00:33:41]But we're even more stretched than that now. So when we talk about a mechanical market, Damian knows what I mean when basically even if you don't trade options, you should understand that the options market right now is a proverbial tail wagging the dog as opposed to the organic spot buying that you traditionally see in a broad-based, you know, market rally, right? We can't discount the fact that we're in a bull market. Remember, there's often a phrase you'll hear me say, we're in a bull market until we're not. But we're just at record levels of call skew. We even talked about this on Friday, how notional call volume exceeded $2.6 trillion dollars on Friday. I think that was a record and it's just because people can bet the market in a way with less money and get extreme leverage, which is something we actually advocate on both sides. But as Damian mentioned before, the asymmetrical bets, if you're taking them, have been more rewarding on the upside versus the downside. Now, silver, we brought this up. This is by way of LEG. We bring up a lot of their charts because they're clean. Sometimes looking at a chart that's just clean that has a simple triangle on it with some moving averages does one for one's eyes, right? We talked about this and I I kind of gave the warning before we even got there. We were building this huge triangle base, but now after today's move, I just want you to see with your eye what I spy. We're breaking out of the triangle. We're also breaking out significantly over the key moving averages. And I'm thinking we're getting close to a golden cross here. Now, a lot of people are going to say, "Okay, well JT, and I know Muhammad is really hot to try on silver." He's always asking us about silver. I want to go ahead and let you know, and we won't look at it directly, but this this particular level or zone right here is what you're looking to best. That comes in around $93, that last peak that goes right into the end of February. And we might, if we have time, I'll look at my own chart work, but that I can just guarantee you we got to get past that. we get past that, we're probably going to challenge the old all-time high. Okay. Now, let me preface everything. Let me conclude by saying something on the back end of what I just said.

[00:35:47]Because silver is a bifurcated metal, meaning it has industrial qualities as well as monetary qualities. If we get a risk off, I mean a true risk, I'm not talking about a 3% move down in semis, okay? Which would be more than healthy.

[00:36:02]I'm referring to real bonafide, you know, five, seven, maybe as much as a 10% draw down in markets. Silver's going to come in. Okay? You just need to know that right now. I think silver is trying to play a catch-up trade. And to Damian's point, you're always curious as to where the money slashing around will go. So, if we do see a a settling down of semis, does that money bleed over into silver? Does it bleed over into Bitcoin? Does it bleed over into software? Is it a mix of all of those names? or perhaps even materials or even health care and I placed some stuff out there on platform from Goldman Sachs I believe regarding healthcare today if you didn't get a chance I believe I put it in the equities tab really interesting chart positioning I wanted to state this for the record this comes by way I believe Goldman Sachs this is precious metals future positioning this does not include CTAs but I looked at CTAs are rel relatively subdued in their positioning but I'm going to point to it because it's a little bit of a chaotic mess right here this particular ular green line right there. That is where managed money futures positions are as a percent of the market and it's relatively low. Okay, I'll just I'll go ahead and say that. Meaning if there was an upside chase, there's plenty of firepower behind the silver price that could push it higher in terms of positioning. And again, I didn't leave you with the CTA chart, but the CTA positioning is I would almost dare I say neutral, right? So they're traditionally driven by algorithms. So, if we saw a move over 93, it gets dynamic and it probably gets dynamic pretty quickly.

[00:37:34]But you got to see that first, just like you got to see Bitcoin close over 826 on a couple daily consecutive closes. The other thing, too, by way of LCG, I love how they just put this out here. You look at traders in the market on the Chicago Board of Exchange, when you're looking at futures traders, silver specs right now haven't really upticked with the price move in silver. So there's a chance that if we see silver specs actually tick up, it could also add to the firepower of silver if we see it break out well above that 92 93 area.

[00:38:04]And if you wonder why I keep mentioning that level is because we get a lot of messages on platform and they're like what do we got to break? What do we got to break? I will just continue to mention a level. That way you can write it down and say I remember JT saying something about 92 93. And that makes it a little easier when you're watching the charts when you're in the heat of the moment. Right. A couple other things.

[00:38:23]This is one by I3. I've got two charts by I3. I3 leing a little bit more bullishly on a lot of different things.

[00:38:29]I really like I3. He and I follow each other. He's a good He's a good guy. But anyways, I3 Invest, this is really remarkable. So, what he did is he took the gold chart and he overlaid it with the 50-day correlation with US 10-year yields. And while not always the case, whenever you get the correlation down below one on the bottom chart, it's usually a good time to long gold. Is it always the case? No, not always. But I can tell you going back the last four or five years, it has been the case. And if we did see a breakout above 4,800, I'll go ahead and tell you the next level of resistance is pretty easy to remember.

[00:39:04]It's $5,000.

[00:39:06]Okay. Now, me personally on gold and silver, you guys already know my long-term is bullish. I'm bullish on precious metals because it's not only part of the debasement trade. It's just I believe that we're moving into a world where people are going to want to own real assets. And since gold's been money for like since the beginning of time, I kind of want to have some in my portfolio. And I have a standing rule.

[00:39:30]You don't have to do the same rule that I do, but I traditionally keep 10% plus or minus within my own long-term portfolio. And right now, it's closer to about 16%. Not because I bought more, it's just because the price went up.

[00:39:42]Now, this is a chart I also placed over on platform. And this is something that is remarkable to me just because as a technician I'm always looking for a confirming factor in the market to give me a little bit more solace and taking a more bullish stance. And what you're looking at at the top is the S&P 2ear normalized return of 42% but that is inclusive of all the AI names.

[00:40:05]Down below we're excluding the AI stock basket. So you got plus 42% here. You only got 16% here. And very similar to when we look at equal weight, I want you to see with your eye what I spy, I'll make this white, make it really thick so it stands out. Notice that we have a divergence here. Meaning, just like when we look at the S&P equal weight versus the S&P market weight, which is traditionally what most people look at, we're not seeing a confirmation in the S&P equal weight. Just the same as we're not seeing it in the triple Q equal weight. So, I'm just letting you know the market is AI right now. And until that changes, that's just the way it is.

[00:40:42]Doesn't mean it can't change. I'm not speaking bearishly or bullishly. I'm just presenting to you the facts and the data as it stands. Couple other things.

[00:40:50]This is something that's really interesting to me. This is from Goldman Sachs Global Investment Research. I want you to first look at this chart on the left because this one we're going to come back to in a second. So traditionally you go back the last 30 40 years of investing the companies that are rewarded the most in the aggregate over the long term are the ones that are very proactive on the dividend front and the buyback front. It doesn't mean that they don't reward those that are focused on capital expenditures and research and development, but by and large it's been about a 2:1 ratio of dividend buyback companies versus those that are spending a lot of money on capex and R&D. And then the ones that are least rewarded are the ones that are looking at mergers and acquisitions. Those companies that are using their capital base to acquire other companies. Remember, when you're the acquirer, you're not the one that's getting the benefit of someone coming in and offering you a deal. You're the one writing the check. So, a lot of times companies are not as rewarded for that over the long haul. And this goes back to 1992. Now, I need you to understand what I just said to you. Okay? From 1992 to present, it's been the dividend payers and the buybacks that have been the companies that are rewarded the most. Now, I want you to see what's happened here in the last few years. So, this is very similar to what we've been seeing in some of our other chart work, but look here.

[00:42:20]This time is different. Meaning that the companies that are being rewarded today are almost like a 1.5 to1 ratio of capex and R&D versus the ones that are buybacks and dividends.

[00:42:32]So, what does that mean? What is that telegraphing to JT? What is it telegraphing to Mr. Brown? What is it telegraphing to all of our good friends here at Seventh Key? It is telling you this is absolutely screaming to you that this market right now is truly just based on sheer momentum and the biggest capex spender and R&D recipient the recipient of those capex expenditures from the hyperscalers are the ones that are being rewarded and then when you throw in terminology like well there's a global shortage of memory then that adds fuel to the fire and that's why you see companies that focus on memory you know like your mic like you're saying that you're seeing them just have these outsized results. But as Lance Roberts put in that very poignant piece that I've laid out, all of these names have not only more than priced in all of the robust earnings of 2026, they've moved into now pricing in all the way to 2028.

[00:43:29]Meaning they cannot have so much as a hiccup.

[00:43:33]And I need I need to pregnant pause here because again, we have traders here and then we have investors here. If you're an investor, I'm not aping into Intel at, you know, a horrible PE ratio or AMD at, you know, a PE ratio close to 200.

[00:43:47]I'm not doing that. I think for a trade, it's been great. I mean, congratulations. I mean, it literally looks like a mean coin some of these stocks. But I'll also argue this now that we're seeing these semiconductors really have these blowoff moves. Notice what's actually responding more favorably. Is it the the anchors in the space like Nvidia or is it the junk in the space? And I can tell you unequivocally it's the junk. Okay. So, when you start to see the junk name start to rally and a lot of the short covering that's been on those names start to become uh un I guess uncovered or covered, if you will, those shorts be covered, that's when you start to see it start to peter out in terms of momentum.

[00:44:29]So, it's really interesting. Another chart by way of I3. I think we got another couple shares. This is really interesting. Either way, he starts the lean more bullishly. I'm just letting you know just based on some anecdotal data based on the six-w week breakout and rate of change. But I found this just fascinating because I geek out on macro stuff. Below is a two-year correlation with a heavy truck index.

[00:44:48]And again, as Damian's mentioned, fundamentals don't seem to matter, nor does the economy. It's just the financial markets that matter. And it doesn't matter how we get them higher, how whatever financial engineering they have to do. But traditionally, when this thing hits a level under 0.9, that's generally speaking a time to be very cautious markets because what it's telling you is that the underlying economy is not as healthy as the market would have you believe. But as I've stated, the market's not the economy and the economy is not the market. But at some point, the twain shall meet, right?

[00:45:20]But that can take a long period of time.

[00:45:22]You know, you go back to 9798 when everybody thought the NASDAQ bubble was just, you know, it was going to pop and it and it had another year, right? And that's why I'm going to show you a chart here of where markets could go. Now, this is, by the way, a bar chart. I actually have a couple buddies over there that work and some longtime friends, some I've known for over 25 years. Some stuff I agree with, but most of the stuff they put out on social media is pretty h it's pretty vanilla.

[00:45:47]It's just more stuff for a statistician to appreciate. But the semiconductor stocks are now trading at 63% above their 200 day moving average. The largest margin since the dot bubble burst. Does that mean semis stop and roll over here? No. No. It's just a data point I found. I thought it was really interesting. And we have gone to the point where the rubber band has been pulled so far in one direction. I think if we do get a snapback, the snapback could be a little bit more violent. One of the things that kind of reiterates that finer point, I believe this was also by way of bar chart or zero hedge.

[00:46:20]No, this was zero edge. Semiconductor stocks are now the most overbought since the 2000.com bubble period. Okay. Can they go a little bit higher? Yeah, because right here, I just want to point this out. We actually did go a little bit higher here. So, you could get close to 90 on the RSI. This is the 14 period RSI. But again, do you really want to do that? Okay, be my guess. just I wouldn't I but I also I've learned from experience that shorting them has been a futile effort and I personally have gotten skimped up at it.

[00:46:50]All right, so where we're at right now 7410 as we're doing this live stream.

[00:46:55]I'm pulling up our road map before I get to Bitcoin because I want to at least get Bitcoin in and I want to get the move index in because I want to show you what exactly moved in the move index with bond volatility and why we've seen such a nice move in the market. First and foremost, I brought this road map out for one reason. I want to highlight the idea of what is possible.

[00:47:16]That's my bullcase up there. You see it?

[00:47:19]8,500. Like everybody says, I'm a permable this or perma bear this, perma bear that. Uh-uh. I I'm willing to be a tape reader. But I'm going to show you something. Why you got to be cautious right here, right now, is not only are we at the 0.5, which is around the 7425 area of this larger measurement, and I showed you guys how I got this particular fib box right here. I'm not going to rehash that for you. You should already know that. If you're not following any of my videos, then the teacher can't give you the answers to the homework assignment, right? You guys know this. I've already gone through it.

[00:47:52]But here's where you need to be a little bit cautious. So, what we're going to do here, I want to make sure that you fully are aware of where we stand currently.

[00:48:01]What we're going to do as a just a wonderful exercise, we're going to take this high right here, and we're also going to take this low right here. All right? And what I want you to do, dear friend, you know, at seventh key, it's like, you know, I can give you a fish and feed you for a day or I can teach you to fish and feed you for a lifetime.

[00:48:16]I want you to do yourself a favor. I want you to take your fib extension or fib retracement tool. Excuse me. Got a little bit over my skis and got to engage my brain first. Fib retracement tool. Click on it. I want you to take it from that peak right there back in January, February time frame. And I want you to drag a fib over this to the low. And what I want us to do here, I'm going to take out the 3618.

[00:48:38]I'm going to take out the 2618, the 4236, and I'm even going to take out the 1272 for now, just to make this super duper clean. What I'm going to do, I'm going to eliminate this fib. Now, what you're left with is a fib retrace of where those two arrows lie. And where you're going to see us getting this particular rejection, and I might not have even drawn it perfectly, is right around the 1618. I told you guys, and I wrote it down for a lot of people, and this is probably not drawn to pinpoint precision. If I did this on an hourly chart, here's what I want you to write down for me. 7450. Just round it up.

[00:49:16]That's the level the S&P 500 has to best. If we get over that, then what happens? Well, does that mean a correction doesn't come into play? Does that mean we just race to the top of this channel in that 8450 level or 8,500 level, JT? No, it does not. And this is what I need you to understand and appreciate. So, we're going to go back to a famous chart that we've had for probably six months drawn here at 7 key.

[00:49:40]And this is our parallel price channel.

[00:49:42]What I need you to appreciate about this is not only the length and duration that the price has gone back and forth inside of this channel, but the simple fact that we have broken out. So, now where are we at? We're over the channel. So that begs the question, if we were to fail at 7450, let's say the CPI comes in hot and it becomes some type of catalyst to get the market to come in a little bit. Well, when you break out of something, what does that traditionally mean? Well, a lot of times what you'll see is a move back down to firm up support. In this case, it would be the top of the channel. And then you get ready for the next liftoff. So, that then tells me that if we did get a corrective, Damian, I'm going to be looking at this zone right here. And I'll get the arrow out of the way as a place for us to actually back test. And what's really unique about that is look at where the 20 MA is racing up to right now. And as a matter of fact, if we went a little step further and we put on our Super Guppy, I'm going to put on our Super Guppy. Green means go, red means no. Green is also very indicative of strong support on the Super Guppy. If anybody wants to know the difference in the Super Guppy and the regular Guppy, not much. It's just a little more colorful, has a little bit more layers of the pie. But as long as this market doesn't break below here, then that means it's fairly okay. And I could say the same thing for the NASDAQ. But I do need to point out, we still have a Dow theory non-confirmation, meaning the transports have now plummeted. We haven't had the Dow make a new high. We don't have equal weight breaking out on both the triple Q's and the S&P. SPXEW being the S&P equal weight of all the cohorts that we're looking at today. But again, I digress. I just need you to understand that I'm willing to be as bullish as the next guy, but I'm not willing to do it in a reckless fashion.

[00:51:25]All right. Now, furthermore, let's keep this kind of same line of thinking going. Let's look at our move index.

[00:51:31]Now, you should know this. This is the Bank of America, Maryland Lynch US bond volatility options market in the bond market. Okay. What I find fascinating is what happened here recently. We got rejected. I was actually hoping to see if we would hold this particular area, the 786. We lost the 786 again. So now the question is, do we hold this last pivot low? And you're probably like, why am I looking at bond volatility if I only care about the stock market?

[00:51:58]Because you need to understand that bond volatility probably as much as anything in the market right now is that the market, the stock market. Okay, just to prove my point one more time, the stock market moves inversely to move. Okay, so if we take the S&P here, I'm going to make this a line chart just really briefly. I want you to see this when I do this upside down. Look at the move index as we correlate it with the blue line, which is the S&P.

[00:52:25]So that's why we look at the move. We don't look, you think I look at things that don't matter. Uh-uh. No, no, no, no. So, we're looking at move and as you can see, it's been in lock step on the move being inverted. And if we see move break lower then then we're going to see the stock market move higher. But if we do catch a bid at the 786 again right around that 68 level or even perhaps if it held 62 and a quarter which is the platinum pocket at the 886 then you're probably looking at a potential top at least an interim top in the market coming into play. If we made a lower low on the move index let me do this really briefly just so you can see it with me.

[00:53:04]We're still trending up on the RSI. So, if we saw this type of move happen, no pun intended. If we actually went lower like this, then we would actually have bullish divergence that would be developing. If we held that 62 62 and a quarter area, and that would be giving me a telltale sign that hey, maybe that 7450 area that we looked at on the 1618 fib for the S&P, hey, maybe it matters.

[00:53:26]Last chart before I come back, and that's Bitcoin because I know a lot of people are curious about it. I'm curious about it. I own a little bit of Bitcoin and I own a little bit of alts. Okay, not huge. Not huge. What I need you to see and spy with your eye what I see.

[00:53:43]Okay, first and foremost, the larger structure of Bitcoin is bearish. You need to appreciate and understand that I said potential bare flag here. What I want you to find really interesting is how the potential top of this bare flag is coinciding with this red line, which is our 200 day MA. Now, I still believe at some point you're going to have a more significant low than the one that we have here, which was our first Fibonacci target. It nailed it. Outside of the wick, we pretty much nailed this move. And a lot of people that are new here, they might not believe us, Damian.

[00:54:16]But guess who also called this move?

[00:54:17]Seventh key. We told you right around 120 125 said, "Guys, we're getting a top here." No one believed me. Sign line was warning, cycle was warning, indicators and oscillators warning. And yet everybody probably and their cousin said JT's crazy. I usually sound crazy when we're getting close to a turn and that's okay. It's good to be a clown near a top or a bottom. That's usually the way I like it. But here and now I'm going to show you something. If we break out above the 82.6 area. All right, let me remove the bare flag so you can see it with me. And I'm even gonna I'll leave the fib. I'll leave the fib. First and foremost, what I want you to see is just the standard guppy. I'm going to put the standard guppy on and I want you to see that it's a little different than the actual MA which we just looked at. This right here is the top of the primary GMMA band. That's where I would suspect we would get some type of resistance.

[00:55:14]And the reason why I'm going to show you a couple reasons why, and I'm coming back to you, Damian, but I don't want to rush this because I know I have a lot of crypto fans watching very intently. Look at when I put on the volume shelf where it lines up with this very large volume shelf here. So, if we got a sneaky move above the 200, a lot of technicians will be like, "It's a breakout. We're going to the moon." Be patient because I'm telling you that guppy is really important. You break over that and you get this air pocket, then all of a sudden we're invalidating a lot of different things. And the last thing I'm going to show you, and this is really pivotal, you understand this. I'm going to get rid of the moving averages that you've seen that we're under and the guppy that you know that we're under.

[00:55:50]I'm going to make this pure clean for your eye to spy what I see with my eye.

[00:55:54]We're going to take a standard fib.

[00:55:56]We're going to do a fib retracement. I'm going to drag it back from this peak right here. I'm going to do the January 14th peak to the $60,000 low. I want you to see where we're also getting stuffed at. Okay. So, if we got over 826, there's another little level here at the 834 area, which coincides just under that primary guppy and also under the volume shelf, which is the 618. And then, of course, if we went a little higher to the 786, it's still under 90,000. That's why a lot of people have asked me what would invalidate my Bitcoin bearish thesis. Basically, a weekly close over about 91 92,000. Now, if we drag it from the secondary peak, sometimes when I'm doing fib studies, I'll take it from the secondary peak because there's a lot of price action that happened there. You'll notice that we're right inside of the golden pocket.

[00:56:43]As of right now, Damian, and again, this doesn't close for three and a half hours. This could be that could be a hanging man candle. And it's happening where? Right at this red line, which is our 200. Again, you get over it. 87 is going to be your level to watch and your level to best. What we need to do is be grown-ups. That's all we got to do. We We've got to be grown-ups. We got to be grown-ups on whatever we're chasing.

[00:57:06]Look, I have no problems with people chasing anything. But I want us to do it responsibly. Meaning, you got to keep risk management key. Keep your stops very close in close by. Whether you're using a guppy or moving average, if you're in the crypto space, you already know the levels to break. If you're in the traditional markets, you know the level to break is 7450. If we broke that, even got a little bit higher, don't just assume for the moment that I put the bullcase out there and we got, you know, a thousand 111,200 points to go. We don't know that to be for certain. So, all I'm going to say is let's be responsible in all of our trading and all of our investing endeavors because if we'll do that and we'll keep capital preservation at, you know, the front and center of our mind, we'll do a lot better. And again, confessions of a bad trade. I tried to short semis a week and a half ago. was dealing with some family matters. I took a bet against semis. I was way too early. If there was anything that I would say that I'm at fault for is I'm generally early on a move. I will tell you guys that I do a SWAT analysis. You should do the same thing if you have never done a SWAT analysis for yourself.

[00:58:07]That's strengths, weaknesses, opportunities, and threats. Okay? So, one of the strengths I have I've got good technical skills, good fundamental skills. That's great. But one of my threats is I sometimes will get a little early in a position. So, I'm letting you know this because dependent upon what instrument you're using, things can go against you in a very quick way. So, you want to make sure that you're keeping your losses because you're going to we are all going to have losses. Look, you're all going to have losses along this journey. But you, the job of all of us is to make those losses small. You got to you just got to check out, all right? And then make sure you're doing yourself a favor by not overstaying your welcome in anything. I don't care if it's a parabolic rise in semiconductors or trying to ape into the SAS space and software space that Damian and I have talked about. Just be responsible and have a little bit more common sense sometimes in the book sense because at the end of the day, friends, it's all about how much money we're making and of course how much money we're losing. And if you can make more than you're losing, you're winning.

[00:59:04]>> If you want to go deeper, join Seventh Key Financial. Daily live sessions, full courses, and a serious community built around long-term results. No promises, no shortcuts. Right now, YouTube viewers get 30% off. That's 30% off their first month across all membership tiers. Use code meat of the move at checkout.

[00:59:24]That's meat of the move. All in one word. Links in the description.