The Stock Market is EXPLODING.... But Don't Be Fooled.

本站添加: 2026-05-08

[00:00:00]Another day, another new all-time high for markets, for the Nasdaq and the S&P.

[00:00:06]We have a lot of big news that I'm going to share with you in today's episode.

[00:00:09]Some comments from Trump that we cannot ignore. We do have some economic data as well. Apple reported earnings last night as well as Sandisk and some other guys.

[00:00:19]We'll talk about that in this video as well. Ladies and gentlemen, we have a big one for you today.

[00:00:26]Because yes, new all-time highs getting a little overextended. And I want to talk about that in today's episode. Do me a quick favor. Hit that like button. Subscribe to the channel if you guys have not done so already and you like to make money.

[00:00:40]If you don't like to make money, don't subscribe. But if you do like to make money, then subscribe to the channel and let's begin. Okay, so here is a big headline today. Trump says Iran is asking for things that I can't agree with. The The big issue is the same issue that it was before the war started. Iran believes it is their right to enrich uranium for medical purposes, for energy purposes, so they say. And Trump he doesn't want any enrichment.

[00:01:12]This is a a very contentious part of this deal. I I think everything else can be agreed upon, but if Iran wants to enrich uranium, Trump says he's not going for that. So, this is definitely not a great sounding headline for this market. Now, do I think we're going to enter another kinetic war with Iran?

[00:01:36]I don't. At least not right now. Why?

[00:01:40]It's a midterm election year. It's uh there's a lot of pressure on Trump when gas prices are hitting multiyear highs. You can no longer call Biden out for higher gas prices when your gas prices are now higher than than than Biden's were.

[00:01:58]It's a very political slippery slope.

[00:02:02]What happens now if you start another kinetic conflict with Iran?

[00:02:07]Well, yeah, the bad the cat is out the bag when it comes to gas prices.

[00:02:11]I I just find that highly unlikely at this moment.

[00:02:16]But does the Strait of Hormuz stay closed and oil stays high anyways?

[00:02:20]Probably if this con- if this conflict is not resolved. It doesn't really look like there is an easy off-ramp here. And and and what's difficult about this conflict is the fog of war.

[00:02:32]You know, one day it looks like we could have a deal done soon within hours. The next day it looks like there's not going to be a deal done anytime soon.

[00:02:42]It's just really back and forth right now. Now, the markets, as I've talked about yesterday, the markets are effectively snitching.

[00:02:50]What does that mean?

[00:02:51]The markets are saying we're not going to have another kinetic war with Iran.

[00:02:56]That this war is effectively over with.

[00:02:59]Hence the S&P and the Nasdaq hitting new all-time highs today. And honestly, are now pretty overextended. And we'll talk about what that means here in just a few minutes after we go through the rest of your news today. Trump says the US is producing and selling more oil right now. And Trump on weapons to Iranian rioters says I'm not happy with the delivery. Trump says gasoline is high, but will fall when the war is over. Here in the news today from NBC, it says the US seeks a new coalition for opening the Strait of Hormuz. Trump on potential Iran strikes says why would I tell you?

[00:03:36]And Trump says the blockade has been powerful. Trump says I am not worried about the US missile inventory all over the world. We have inventory we can take. Trump says that uh the hardliners in in Iran want to make a deal, too. So, while we don't have all of the details around this this deal, what they're talking about every day, we kind of have the bigger picture of it.

[00:04:01]What is the bigger picture? Okay, we're going to open the Strait of Hormuz.

[00:04:04]We're going to end the conflict. No more war. Guarantees that there's not going to be another war on Iran.

[00:04:11]But we're we're going to not agree that we're not going to enrich uranium.

[00:04:17]That we're going to talk about that at a later date.

[00:04:20]Well, Trump has said, "Look, there's no enriching uranium."

[00:04:26]This This could end abruptly if that one detail changes.

[00:04:32]If there's some kind of understanding that there just won't be a nuclear weapon, which was kind of where we were beforehand.

[00:04:42]Obviously, you could believe that Iran was secretly developing a nuclear weapon. And then they probably were, right? Let's Let's face it. Like Iran definitely wanted a nuclear weapon even though their nuclear doctrine i- i- is against nuclear weapons.

[00:04:58]But if Iran would agree to not build a nuclear weapon and allow inspectors into the country, one of the big reasons that uh so- so-and-so like says that we started this war with Iran is because Iran n- was no longer letting uh UN nuclear inspectors into the country. So, they feared that Iran was rushing to create a nuclear weapon.

[00:05:27]If Iran agrees to comply and allow UN nuclear um audits, right? Let UN into the country to make sure they're not building a nuke, then maybe Trump would agree to enriching some form of uranium. Maybe they could call that a successful deal on both sides. I don't know, but I do know if that if that's the one big detail that's really missing here, this could end abruptly. Donald Trump on Iran options says either blast them away or make a deal. And even though my base case is not for another kinetic war with Iran and clearly that's not the base case for the markets either with the S&P and the Nasdaq just ripping higher. Uh on face value, if you knew nothing else about the markets, you wouldn't think that there's any possibility even of having another kinetic war with Iran.

[00:06:22]Obviously, there is that possibility, but markets are telling you that's not going to happen. Typically, markets are correct, right? Typically, if you're going to get a move like this, it's it's telling you something.

[00:06:35]Now, if we did have a kinetic war with Iran, I think it would be very short-term, within a couple of days and then Trump would just declare victory. Say, "Look, if we have to go in and hit them again if they're building enrichment facilities, we will do that, but we've accomplished our goals."

[00:06:52]So, that's a possibility, although it's not my base case. You have to be prepared for that. Trump on Iran says right now we have talks going on. They're not getting there. Trump says the visit to China will be great. Trump says we just had a conversation with Iran. Let's see what happens. Trump says Iranian leaders don't get along with each other. Trump says we made strides in talks with Iran, but not sure we're going to get a deal.

[00:07:17]In a little bit of bad news today that did send markets lower a bit. Trump says tariffs for the EU will be increased to 25% on cars and trucks coming into the US. Iran's foreign minister Aragachi says Iran is ready to pursue diplomacy if the US changes its excessive demands, threatening rhetoric and provocative action. And Aragachi says the US is the main source of insecurity in the Strait of Hormuz. When asked about Iran submitting a proposal to Pakistan, White House says we do not detail private diplomatic conversations. Negotiations continue. Per CNN today, Iranians brace for a return to war. Fed Lael Brainard today pushed back on the easing bias yet again. And we do know that there were four dissents at the last Fed meeting.

[00:08:03]Fed Mester wanted to cut rates. Fed Lael Brainard wanted to remove the easing bias in the statement.

[00:08:12]Kashkari and someone someone else. Can't remember the last one. Okay, so there were four dissents, the most since 1992. Well, Lael Brainard said today the Fed's next move could still be a hike or a cut, citing high uncertainty in the outlook, a stable labor market and growing concern over returning inflation to 2%.

[00:08:32]Brainard added that the path for inflation remains unclear and policy should avoid signaling premature easing.

[00:08:38]Good thing individuals like this are not the the chairman at the Fed because holy moly would we have a bigger problem on our hands. That kind of incompetency is is actually quite impressive as a Fed governor. So, long story short, you know, this Iran situation is still a driving factor for this market right now. And it will be until this conflict is over with. But the bottom line is markets, they're saying it's going to end.

[00:09:08]Whether you agree with that or not. Wall Street and stocks are saying the war is going to end.

[00:09:15]That's it. That's the bottom line to it.

[00:09:17]You are overextended at this point though. So, if there were to be a kinetic war with Iran, even if it lasted only a couple of days, that would be like a black swan event at this point.

[00:09:27]Even though we all know that that i- i- is a possibility, markets are not pricing that in as a possibility at this point. They're just not. The RSI on the S&P is at 72.3.

[00:09:41]You're above 70. You're You're overextended. The RSI on the Nasdaq is at is at 75.

[00:09:49]I mean, this is pretty remarkable to be to be this overextended at a time when the war with Iran a lot of people think is going to restart. So, that's a little dangerous.

[00:10:02]If the war with Iran did end, I also think you could get a near-term sell-the-news event. Okay, even if the war ended, people are going to say, "Okay, war has ended, now what?"

[00:10:13]Well, we just had Magnificent Seven earnings, pretty good across the board.

[00:10:17]A lot of Magnificent Seven stocks sold off after earnings.

[00:10:20]Microsoft, uh Amazon was was kind of mixed. Uh Meta really sold off, right? Tesla sold off uh following their earnings.

[00:10:31]You would likely see a broad rotation away from the war trade into maybe software, financials, other areas of this market. Depending on what Magnificent Seven did, you could actually see the markets come down and some areas do really well. Uh you can also see this uh overextended uh nature of the markets in the VIX. The VIX has totally collapsed from the highs that you were at in like the the 30s, okay?

[00:10:58]The VIX is down to 16.71 today. You're back down to where you were in January uh of this year, even before the SAS apocalypse. Like there's not a lot of fear out there in this market represented in hedging activity, right? Because the VIX is showing you hedging on the S&P, which is kind of surprising considering you know, the markets are as high as they are, as overextended as they are.

[00:11:25]People People don't want to go out and buy puts. All right? Like like there's not a lot of appetite for that. Now, in your broader indexes today, the Russell 2000 is up 0.2%, Nasdaq up 1%, S&P is up a half of 1%, and the Dow is down 0.06%.

[00:11:42]So, definitely a Nasdaq-driven market today. If we look at oil, oil's actually down 3%, which is a little surprising considering the the comments that we have today. It says oil prices fall after Iran sends updated peace proposal to mediators. And then we had the comments from Trump. Trump said, "It's not good enough. We could blast them away." And oil's still down 3% today.

[00:12:08]So, maybe that's just a little bit of consolidation after the recent rise that we have seen in oil, but it's a little surprising to me. 10-year Treasury yields are down about 1 and 1/2 basis points.

[00:12:21]What's more important for near-term easing is 2-year Treasury yields, and those are roughly break-even today, not really moving at 3.882%.

[00:12:32]So, I can tell you right now, the odds of Fed rate cuts not doing a whole lot today. In fact, the into the foreseeable future, there's no expectation of rate cuts at all. In fact, going out till December 8th, 2027, the highest probability is no cut or no hike at 36%.

[00:12:58]Yeah.

[00:12:59]Eight like 18 months from now, more than eight 19 months from now, you're still not even pricing in a single rate cut.

[00:13:06]Okay?

[00:13:07]For December 8th, 2027, there's a 33.4% chance of one rate cut, 13.8% chance of two rate cuts, and a 3% chance of three rate cuts.

[00:13:17]For the end of 2027, for December 8th, there's a 12% chance of a rate hike.

[00:13:25]So, again, depending on what happens with this war with Iran and oil prices, you could see some pretty rapid changes in the expected path of Fed policy. And if you're a bull right now, that's something you better be hoping happens, right? That you can actually start to price in a rate cut this year. If that happens, yeah, there's going to be a lot of upside for tech, for cyclicals, financials, you know, some of these areas that have really underperformed uh other areas in 2026. Now, I do think in a moment like this, a lot of people are missing the bigger picture. Yeah, initial jobless claims yesterday came in at the lowest level you've seen in 5 years, right? The labor market looks like it's doing just fine. GDP came in lower than estimated estimates yesterday. The estimate was 2.3%. It came in at 2%. Big deal, missed a little bit. 2% GDP was the first estimate for Q1.

[00:14:20]That's a pretty damn good number last I checked.

[00:14:22]Okay? But if we look at inflation, inflation went up in January, February.

[00:14:28]It came down in March.

[00:14:31]So, it's actually decelerating throughout this war with Iran. Core inflation, not headline, core inflation has been decelerating. If the war with Iran did end some point, hopefully, um you're probably going to continue on that disinflationary path throughout the rest of this year. And that's why like Powell said the next 60 days, 90 days are going to be so important for the inflation outlook because, you know, if the war lasts another 60, 90 days, higher oil, it will start to feed into higher core inflation. It It's just that will happen. But if it were to end, yeah, April could be a little bit higher, but then you should get back to that disinflationary path within core CPI once again. But right now, inflation's actually been falling. So, if the war with Iran were to end, yeah, the Fed wouldn't be cutting rates because the economy sucks, they would be cutting rates because inflation's coming down, Fed funds rate is staying the same, you're actually getting more restrictive even though you're not changing Fed policy.

[00:15:35]Hopefully that makes some sense. Now, if we take a look at the heat map today, kind of as I've been talking about here, consumer defensives coming under some pressure, industrials, energy, healthcare's kind of a mixed bag, financials kind of a mixed bag across the board, not doing terrible, though.

[00:15:53]Technology's an outperformer. Apple up 5 and 1/2% following their earnings. Some of the consumer cyclicals, right? So, Tesla up 3 and 1/2%, Amazon up 1 and 1/2%, communication services definitely outperforming some of the other areas.

[00:16:08]Software doing really good today, right?

[00:16:11]These are the areas I think will be the outperformers, especially if the war with Iran does end and we can start to price in a rate cut.

[00:16:20]Okay? Um you want to stay away from industrials, consumer defensives, utilities, energy, parts of healthcare, like high-dividend healthcare names um that have been more of a flight to safety during this conflict.

[00:16:35]It It's just the obvious move to me at this point. If we look at the areas that are outperforming today, okay? There's four areas that I have told you that are going to outperform over the next couple of months, even if the S&P does come down. This has to do with valuations.

[00:16:55]Okay? These valuations of these four sector groups are at weirdly low levels.

[00:17:01]Okay? Just really low valuations historically for these four sector groups. I'll share the four sector groups with you here in just a moment.

[00:17:08]You have AI that's going to be huge in these four sector groups.

[00:17:13]And again, if the war with Iran ends, these are companies that are going to benefit from a stronger economy, lower inflation, more Fed rate cuts. Okay? The four sector groups, technology, communication services, financials, and consumer cyclicals. Okay? Those are the areas the only areas that make sense to invest in right now.

[00:17:35]What are the areas that are outperforming? Technology's the biggest outperformer today, up 1 and 1/2%, consumer cyclicals up 0.67%, communication services up 0.1%, financials break-even.

[00:17:47]The four sector groups that I've been saying are the only sector groups that make sense to invest in right now are the outperformers, even though it's not like a great day for some of these, they are the outperformers.

[00:18:00]Consumer defensives down 0.05%, utilities down 0.13%, healthcare down 0.2, real estate down 0.22, basic materials down 0.42, industrials down 0.67, energy down 1.31%. Even then, again, I'm going to kind of go back to what I was saying, look, even though it it from some of the comments from Trump, it doesn't look like the Iran war is ending anytime soon, look at energy.

[00:18:28]Look at the stock market.

[00:18:31]Those things are saying that this could be ending soon. They're effectively snitching. But again, I am a just a little nervous about the headline markets here. I'll talk about that more in-depth in the next video, my step-by-step uh expectations throughout the rest of this year.

[00:18:50]Um What I'm thinking about right now, how I'm positioning in this market, all of that.

[00:18:57]That's going to do it for this video.

[00:18:58]That is what is happening today. That is all of the news you need to know. Get you caught up to speed here. Hit that like button. Subscribe to the channel if you guys have not done so already. If you guys want to come trade and invest alongside of us, that link is down below in the description of today's episode. I did buy another stock today. So, I don't buy new stocks um all that often. I I like to highly concentrate into the highest conviction stocks, um which have been doing very well recently. But I did buy a new one today. So, if you guys want to check that out, come join us.

[00:19:31]That link is down below. Have a great rest of your day, and I will see you in the next one.