Author: Ross Givens

Good evening, and welcome to this week’s edition of Stealth Trades!

In one of the most volatile trading sessions of the year, stocks went from “way up” to “way down” in just a couple hours Thursday.

Nvidia reported a big earnings beat the Wednesday after the close. It, along with just about every other tech stock, opened higher the next morning.

But an hour into the trading day the selling started. And it didn’t stop until the closing bell rang.

It was a bloodbath from start to finish.

Days like this are exceptionally rare…

When the market opens up by more than 1%, it almost never finishes the day in the red. It has only done so 7 times since 2015.

And the worst two occasions both came this year.

The first was April 8^th when stocks melted down on tariff-related news. The other was yesterday.

Even more surprising is that this came on no apparent news…

Unemployment ticked up every so slightly (4.4% vs 4.3% est).

The Labor Department announced they would halt the October jobs report. This wasn’t great news since it lowers the odds of a December rate cut, but nothing catastrophic.

The biggest piece of news on the day was actually positive– Nvidia’s crushing 3^rd quarter sales and revenue numbers. So why the big selloff?

I’ll be honest… I don’t know.

There is no obvious reason. In all likelihood, this was systematic liquidation by a large hedge fund. Maybe somebody got spooked and decided he wanted the firm’s portfolio in cash. Immediately.

Perhaps Norway or the Saudis reduced exposure in their trillion-dollar sovereign wealth funds.

Anything is possible.

But this is one of those events we just cannot predict. At the end of the day, the stock market is an auction. It is buyers and sellers trying to agree on price.

At any time, sellers can overwhelm buyers. Supply can outstrip demand. No matter the reason and whether they’re right or wrong, when a big player wants out, there is going to be collateral damage.

I’m reminded of a scene in the 2011 movie “Margin Call” where the CEO of a major investment bank decides to liquidate their entire portfolio. If you haven’t seen it, it’s worth a watch.

Here is the clip

This is a dramatic example, but the same thing could have transpired at a hedge fund or major endowment fund Wednesday evening.

The indexes recouped some of Thursday’s losses today. I am writing this 2 hours before the close with the S&P 500 up 1.44% on the day.

There is a silver lining to events like this, however. It stress tests the market… shows you where the weakness is… and also the strength.

A clear standout on Thursday was the biotech sector. Below is a daily chart of XBI – the biotech ETF.

Do you see the selloff? I don’t.

The biotech sector looks like business as usual. Its uptrend is completely unphased. So, at least for right now, this is an area I will be looking to find new setups.

One of our analysts, Tyler, has been focused on this space for a few months. And he sent over a couple of his favorites.

One is Cogent Biosciences (COGT).

Peak Phase 3 drug trials for its new drug, Bezuclastinib, showed tremendous success. I won’t pretend to understand the science, but the chart looks beautiful.

Following a 119% overnight gain, shares have held their ground. In fact, they are drifting higher. This is likely the start of a much longer run higher.

Arcellx (ACLX) also looks great.

This mid-cap biotechnology company has nearly doubled off its April lows.

It is now setting up what looks like a potential breakout move higher.

Look, Thursday was tough. I get it. I took a lick just like everybody else. But this is, unfortunately, just part of the game.

We pick ourselves up, wipe off the blood, and climb back in the ring. Weeks like this are what mold seasoned traders.

Best wishes for your trading,

Good evening, and welcome to this week’s edition of Stealth Trades!

Here’s how I am allocating my retirement account for 2026:

• 40% Equities
• 25% Energy
• 25% Metals
• 10% Real Assets & Infrastructure

Today I am going to lay out my full allocation with ticker symbols, exact percentages, and the rationale behind each.

I am not instructing you to do the same. This is where I, at 42 years old, am putting my money. And it is based on a number of assumptions you may or may not agree with.

Only you can decide that.

Now, to be clear, this is the play for ONLY my retirement account. Most of us have multiple investment accounts.

I, for example, have 529 accounts for each of my children’s college savings. They hold a simple market index fund and get automated deposits every month. I don’t touch them.

I also have a few trading accounts where I am more active. I go from long and on margin to completely in cash sometimes overnight.

But I am far less active with my wife and my retirement accounts. These are dollars I don’t want to take big risks with. And they are invested with a much longer time horizon.

My approach – and I’m not saying this is right or wrong – is to be tactically diversified. I want broad exposure but focused in the areas likely to outperform over the next few years.

What will the world look like 20 years from now? I have no idea.

But 2 years from now? That’s a little easier to predict.

I only hold ETFs – exchange traded funds. These are the modern-day equivalent of mutual funds. They hold a basket of stocks in a given sector, index or region.

My goal is to avoid single-stock risk and stay focused on leading themes.

For the last few years, that has been AInce.

The artificial intelligence ETF, ticker AIQ, has nearly doubled over the last 2 years.

Would you have done even better putting it all in Nvidia? Sure. But you also could have suffered unrecoverable losses. Again, no single-stock risk.

But looking at things today, at the tail end of 2025, are AI stocks likely to keep going higher?

It’s hard to say. Valuations have reached extremely elevated levels. Some are calling it a bubble.

In my opinion, the AI trade is a bit long in the tooth. Buying here feels like the equivalent of showing up to a baseball game in the 8^th inning.

Instead, I am focusing on what I believe will be the big winners in 2026 and 2027 – energy, metals and physical assets.

I could go on for hours about the flaws of government physical policy, but the short and sweet of it is this – Uncle Sam will never stop spending.

The government will never live within its means, the debt will continue to spiral out of control, and the money printer will keep being used to fill the gap between what comes in and what goes out.

That gap is widening. And we have some of the best economic conditions in decades.

When things turn south? They’ll print trillions more.

Inflation is going to get worse. It is an unavoidable reality. And I expect this to be a tailwind for asset prices for many years to come.

Housing will become less affordable, not more. Gold and silver will double again. And by 2030, expect your power bill to be twice what it is today.

And since Washington has no intentions of steering their bloated ship toward anything resembling responsible stewardship, we must take action to protect our wealth.

My allocation, which I noted earlier, is as follows:

• 40% Equities
• 25% Energy
• 25% Metals
• 10% Real Assets & Infrastructure

At first glance, this might look overly conservative. But as you will see, the bulk of the dollars into energy are going to energy stocks. The same is true of the metals and infrastructure allocations.

So, in reality, the percentage going to equities is much higher. The 40% only refers to index fund investments.

That equities bucket looks like this:

I used Vanguard ETFs which are not only liquid but offer the lowest management fees in the industry.

I have also tilted the funds away from mega-cap AI stocks by putting half to value stocks, small and mid-caps, and emerging markets.

40% of the S&P 500 is dominated by just 10 companies. Nvidia alone is nearly 8%. That stock is up 12-fold. I do not want a bunch of money in an index that can be tanked by a single company.

My rationale for each ETF is detailed above.

Next is energy…

I am putting 25% toward energy stocks – split between renewables like solar and nuclear and traditional oil and gas.

This, to me, is one of the biggest investment opportunities of my lifetime. Data centers are creating huge demands for energy. Municipalities located near them are seeing energy prices surge.

There is a nationwide race to generate enough juice to power these AI data machines.

Another 25% is being allocated to metals which is further split between precious metals that I expect to rise as the dollar weakens and industrial metals used in infrastructure projects.

This email is getting long, so I will let my rational notes above do the talking here.

And finally, a 10% weight to real assets and infrastructure. This is achieved with three ETFs that are pretty self-explanatory.

This is my plan. Will it outperform the market? I hope so. It definitely feels safer than betting it all on a continuation of the AI bubble.

But there are no guarantees.

This portfolio meets my objectives. It aligns with my macroeconomic views. And it will let me sleep soundly at night.

Do with this what you will.

Best wishes for your trading,

Good evening, and welcome to this week’s edition of Stealth Trades!

After a record rally off the April lows, the AI trade is getting a bit long in the tooth.

The big leaders of 2025 are showing weakness and beginning to roll over. Nvidia – the undisputed king of the AI revolution – fell as much as 14% this week. And 14% of 5 trillion dollars is no small thing.

Palantir, which I discussed in depth in a YouTube video this week, fell after reporting better-than-expected earnings and sales and raising forward guidance. 

Generally speaking, this is not a good sign. When stocks drop following positive news, it is often a sign they have become overpriced. Investors are unimpressed with anything but massive beats.

Essentially, Wall Street has priced in perfection, and anything else is being viewed as a disappointment.

The market indexes, thanks to the enormous valuations of the tech giants, are disproportionately weighted to a small number of mega-cap stocks. Nvidia, for example, represents nearly 14% of the entire Nasdaq.

So, as Nvidia goes, so goes the market. And given the interconnectedness of the big AI players, weakness in one tends to rub off on the others, creating a domino effect that brings markets down.

Is this the end of the bull market? 

It’s possible. But I doubt it. To me it feels more like a near-term pullback. And after the run we have seen in the last two quarters, the market needs it.

It is not healthy to go straight up forever. That is what leads to nasty crashes like what happened in 2000 when the dot-com bubble burst.

Plus, if the market were cashing, everything would be going down. And at least so far, that is not the case.

I have discussed the strength we are seeing in the solar area for the last month or two. A quick look at the industry strength tables shows that it has spread to the whole clean energy sector.

The macro argument is a simple one – we have an energy crisis. There is not enough juice to power our daily lives. And artificial intelligence with its massive power-hungry data centers is accelerating the issue.

This is why nuclear stocks performed so well in 2025. But those stocks, like the big AI darlings, are seeing their stock prices come back down to earth. 

Solar stocks, on the other hand – represented by the Invesco Solar ETF – are steadily marching higher.

The iShares Global Clean Energy ETF (ICLN) represents the whole sector – solar, wind, renewable utilities.  It is also trending nicely.

Those looking for individual stocks in this sector might want to keep an eye on stocks like Clearway Energy (CWEN).

It broke out from a textbook cup and handle pattern this week on big volume. And despite weakness in the general market indexes, CWEN has held strong near $35 and looks like it wants to go higher.

First Solar (FSLR) is another stock showing tremendous strength.

It has been riding its 20-day moving average like a jockey at Steeplechase.

The stock hit $317 back in 2008, so it might be time to finally make a new one.

Overall market conditions remain weaker than what we have seen over the last two quarters. I have reduced my equity exposure, especially in the highflyers like nuclear, quantum and AI. 

Ideally, we will see an 8-12% pullback in the indexes to knock the froth off and force the cowboys to de-leverage, then set up for another run higher.

I will keep an eye on where the money is flowing. But as of today, Wall Street is betting on higher prices in clean energy.

Best wishes for your trading,

Good evening, and welcome to this week’s edition of Stealth Trades!

Good evening, and welcome to this week’s edition of Traders War Room!

Ever heard of fractals?

They are defined as “infinitely complex geometric patterns that are typically self-similar.” In other words, these are patterns that look similar at different scales.

And they can be hugely beneficial for traders. 

18 months ago, I wrote about the breakout I saw coming in gold. And the reason I was so bullish was this concept of fractals.

The breakout pattern I look for appeared on the daily chart… the weekly chart… and even the monthly chart.

Same pattern. Same ticker. But vastly different time frames. Take a look…

This alignment of multiple time frames in nearly identical patterns foreshadowed what has been the biggest gold rally in over a decade.

13-year base patterns forming on a monthly chart are rare. But we can do the same thing with weekly, daily, hourly and even 5-minute charts.

Take a look at Rigetti Computing (RGTI) – one of the big movers in the quantum computing space. Below is a daily chart highlighting the breakout that took place last month.

It delivered a 226% peak gain in just over a month.

But it was a volatile stock. Placing a stop loss at the swing low from the week before would have meant risking 20% on the trade.

However, if we zoom into a 5-minute chart of RGTI at that time, look at what we see…

This is a fractal – a similar pattern but on a much shorter time frame.

And with this setup, you could have taken minimal risk of less than 4% on your entry. Maybe it works, maybe it doesn’t.

But so what…

It’s a 3.6% risk. You can take several stabs at it and still not get yourself in trouble. I sometimes refer to this as “day trading my entry.”

A day trader I am not. But I do love high-momentum stocks. And for a lot of them, 20-25% swings are normal.

I won’t risk 25%. But I’ll risk 4% all day long.

Now, let’s look at Rigetti today. Below is a current daily chart. What do you see?

Volume ramped up in that huge September rally. The stock then pulled back and is now consolidating in that $35-$45 range. It is also doing so on decreasing volume – a sign that the selling may be coming to an end.

Buying a breakout above that upper white line and placing a stop loss at the lower one is still a 17% risk.

So, let’s zoom in closer on a 30-minute chart…

Do you see the pattern?

Remember, we want to see that same shallowing consolidation after a stock pulls back. The same supply and demand principles apply. The stock needs to absorb the supply (get all the sellers out of the way) before it can push higher.

Is this a picture perfect pattern? No. But it’s not bad.

And on a leading stock, in a leading group, in a record-setting bull market… you don’t need perfect.

Plus, the risk is minimal…

With a stop loss just beneath the swing low here, we are only risking 5.5% on the entry.

This is a stock that just tripled in a month. I can easily justify a five and a half percent risk.

You may be comfortable with bigger stop losses and more risk. I’m a chicken. I like to keep it tight.

I’d rather take a few small losses trying to get into a leading stock than put all of my risk on a single entry.

That’s all for this week. As you read this, I am Trick or Treating with a 6-year-old Bowser (Mario Bros character) and a 3-year-old monkey. Bedtime should be interesting. Pray for me.

Best wishes for your trading,

Good evening, and welcome to this week’s edition of Stealth Trades!

Last Friday, the market tanked after Trump announced 100% tariffs on China. Three days later, we were right back up.

I have been seeing a lot of bearishness lately in the financial press calling for a top in the market.

Stocks have one bad day, and everyone says the rally is over. Gold drops 2% and people think it’s time to sell.

This market rally has been one of the strongest moves ever. The Nasdaq is up 45% in six months. That just doesn’t happen.

So, I get it. I understand the fear that things have gone too far too fast.

But one of the oddities of the stock market is that when prices appear too high, they tend to go much higher. And when things seem cheap, they usually get even cheaper.

By most traditional metrics, stocks are overvalued. But that doesn’t mean we are at the highs.

I track a handful of breadth metrics to track the strength of the market beneath the service. And, as long as things appear healthy, odds say we go higher.

The advance/decline line, which keeps a running tally of how many stocks went up or down each day, is holding near its highs.

If the indexes were being propped up by a small group of mega cap stocks, we would see weakness in the A/D line like we did at the end of 2021. But we are not.

The net new highs and lows indicator is also printing bullish.

We experienced a day with 65 net new lows last Friday but have quickly returned to new highs.

The percentage of Nasdaq stocks above their 50-day moving averages currently sits at 57.4%.

We have held in the 50-70% range for most of this rally, and I won’t worry unless we fall below 50%.

The high yield index is falling as well.

When economic conditions sour, banks tend to hike interest rates to their riskier borrowers. All things being equal, I like to see this rate steadily trending lower like it has been the last six months.

It kicked higher on Trump’s announcement last week but has now come back down to 6.58%.

There are no guarantees. Anything can happen. But right now, nothing says the bull market is over. It could take a break. We might see a shallow pullback or consolidation. But make no mistake… the bull market is still in full effect.

Best wishes for your trading,

Good evening, and welcome to this week’s edition of Stealth Trades!

Gold is soaring. So is silver. Both just made new all-time highs.

But if history is any indication, palladium prices are setting up to do even better in the coming months.

Palladium often flies under the radar as a precious metal investment, but it is far rarer than gold or silver. Annual global production hovers at just 6-7 million ounces, compared to 120 million for gold and 800 for silver.

Adding to this shortage is the fact that most palladium production takes place in areas with geopolitical tensions. 80% of global supply comes from Russia and South Africa.

The largest producer is Norilsk Nickel – a state-owned Russian mining operation. The company has already slashed Russian exports by 30% thanks to Western sanctions following the post-2022 Ukraine invasion.

South African mines are facing labor unrest, power outages, and declining ore grades, further constraining and creating international bottlenecks.

The World Platinum Investment Council forecasts a palladium deficit of 500,000 ounces in 2025. Non-Russian supply growth is tepid, and I don’t see Putin going out of his way to ship more supply to the United States any time soon.

New projects in Canada and Australia might add 35,000 ounces by 2032, but that’s a drop in the bucket against rising needs. This structural tightness—exacerbated by concentrated production by US adversaries—creates a supply constraint that will lead to soaring prices.

Because demand for palladium is not going to decline. If anything, it is likely to increase.

Palladium has unparalleled utility across key industries – especially those driving the transition to cleaner technologies. Thanks to its efficiency under high temperatures, it is the key component in catalytic converters which reduce harmful exhaust emissions like carbon dioxide.

Palladium’s corrosion resistance and catalytic properties make it ideal for electronics, where it’s used for plating printed circuit boards, semiconductors, and connectors.

In dentistry, it forms durable alloys for crowns and bridges. Jewelers favor it as a hypoallergenic, platinum-like alternative for high-end white gold settings.

Palladium is now being used in emerging applications like fuel cells and hydrogen purification since palladium membranes can selectively filter hydrogen for fuel production.

Hydrogen powered technologies alone are projected to require 20% more palladium by 2030.

But for price projections, I prefer to let the charts do the talking. And, as you’re about to see, the picture it paints is one of higher prices.

Below is a daily chart of palladium futures:

After surging by 40% in June and July, the metal consolidated in a shallowing pattern before breaking through the $1,350 level last week.

But stepping back, we can see an even larger pattern…

In the weekly chart above, we see a textbook “rounded bottom” pattern that is 2.5 years in the making.

Palladium is a tricky metal to buy since production is so limited. Coins often sell for 15-20% above spot prices whereas gold and silver are typically much lower.

Futures trade in line with spot prices, but it is a big contract. Representing 100 ounces of palladium, one PA futures contract controls $150k of the metal.

Luckily, there is also an ETF. PALL is the ticker symbol for the abrdn Physical Palladium Shares ETF. And if there was any doubt that investors are piling into this sleeper metal, take a look at the chart of PALL below.

Weekly trading volume has tripled in just the last few months.

Gold and silver have made great runs, but each is getting a bit extended. I hold both and believe they will be higher in the future.

But palladium is in the early stages of a fresh breakout. And investors looking for metals exposure may consider adding palladium to their portfolio in one form or another.

Best wishes for your trading,

Good evening, and welcome to this week’s edition of Stealth Trades!

Gold has been a currency metal for over 5,000 years. It is the go-to safe haven investment.

But the real appeal of gold is the protection it provides against inflation. And in the next 10 years, we are going to see inflation ramp way, way up.

The culprit behind the coming rise in prices is the same one who always causes inflation. In fact, it is the only entity that is even capable of causing inflation.

I’m talking, of course, about the US Treasury.

Inflation is caused by one thing and one thing only: increasing the money supply. When more dollars chase the same number of goods and services, prices rise. This is basic economics. Yet the Federal Reserve acts shocked every time it happens.

You see, the federal government is incapable of living within its means. Despite taking 30% of our income, it has spent more money than it has taken in in each of the last twenty years. This figure – the difference between what they spend and what they take in – is known as the deficit. And it currently sits at nearly $2 trillion.

When someone doesn’t have enough money to pay their bills, they have two options: don’t pay or borrow money to pay.

America is no different. And every year she chooses the latter, adding trillions more to a national debt that will never be paid off.

That debt takes the form of treasury bonds. When a bank or individual buys those bonds, the government is borrowing money they will one day have to pay back. When the Federal Reserve buys the bonds, they simply print money electronically to purchase them and deposit those funds into government accounts.

This is what increases the money supply. And this alone is the source of our inflation.

But we have now reached what I believe is the point of no return…

Interest payments are now the government’s second largest expenditure. The figure below was through June. And it will exceed one trillion dollars in 2025.

We now spend more money on interest than we do on national defense. And this is entirely unsustainable.

Unfortunately, our legislators do not care. Even the ones who claim to continue passing spending bills that exceed tax receipts by trillions of dollars.

By 2035, interest payments will exhaust 100% of income tax revenue. So that 22% or 32% or 37% of your income you pay in taxes? They will need ALL of it just to service the debt on money they have already spent. And, unlike a mortgage or car loan, none of those payments go toward the principal.

World governments are taking notice. So are central banks. Even individual investors like me see the writing on the wall. The US is broke. And the situation is rapidly getting out of control.

Sovereign investments from countries like China are not going to US bonds anymore. Instead, they are choosing gold. And I believe you should do the same.

Gold is the only real money there is. It has been a currency metal since before Jesus walked the Earth.

The fiat paper money printed by Uncle Sam is dwindling in value.  The US dollar lost a whopping 10% of its value in the first 6 months of 2025 alone. And as the debt continues to rise, it is only going to get worse.

As the deficit rises, the government has to borrow more and more money. At the same time, demand for treasuries is dwindling. This leaves only one solution… printing the money it needs to fill the gaps.

And, once again, we are right back where we started with soaring inflation and rising prices.

The only other option would be to default. But I can’t see Washington ever doing that. It would completely collapse the financial system. Retirement funds and bank reserves holding government bonds would drop to zero overnight. The US dollar would lose its reserve currency status. And foreign nations would economically penalize America any way they could.

Make no mistake, America will try to print this problem away. Because they won’t quit spending.

Even Elon Musk and his DOGE team, which supposedly had the full support of the White House, failed to push any meaningful savings through. In fact, the government voted to raise the debt ceiling by $4 trillion as soon as he left DC.

I don’t say all of this to scare you. By now you should know that I am not a doom and gloom profit. In fact, quite the opposite. I remain bullish on the stock market and American business in general.

But I have run the numbers eighteen different ways and see no other possible outcome. And the only way to protect yourself from the effects of inflation is by owning gold and other physical assets. That means precious metals like gold and silver, residential and commercial real estate, farmland and the like.

Gold is in the middle of a powerful super cycle. After breaking out of a 14-year base, it has surged from $2,000 in 2024 to $3,700 today.

In all likelihood, this is just the beginning. I expect to see gold at $8,000-$12,000 an ounce by the end of 2027.

Silver is also making a historic move higher.

There are a number of ways to gain exposure. You can buy physical gold and silver from online brokers like Apmex (I just placed an order this morning.) There are also exchange traded funds like GLD (gold) and SLV (silver) as well as mining stock ETFs like GDX (gold miners) or SIL (silver miners). I won both in my retirement account.

Either way, I believe every portfolio needs some exposure in the precious metals space.

Best wishes for your trading,

Good evening, and welcome to this week’s edition of Stealth Trades!

The Fed cut interest rates Wednesday for the first time in 2025, blaming a weaker labor market. A jobs revision earlier this month showed that 911,000 fewer jobs were created last year than previously thought.

If you’re not aware, the Federal Reserve has two jobs which they refer to as a “dual mandate.” Those are to control inflation AND ensure a healthy labor market.

When prices rise and inflation gets out of control, they raise rates to combat it. That is what happened in 2022 which triggered a bear market.

But, when the economy is weak and unemployment is rising, they lower interest rates to stimulate the economy. And that is what happened this week.

Powell and his buddies at the Fed have found themselves in a precarious position…

On the one hand, the economy is slowing, job growth is dwindling, so they need lower rates to fix this

On the other hand, inflation is at 3% – firmly above their 2% target. Historically, the Fed does not cut rates when inflation is this high. In fact, they haven’t done so in more than 30 years. But this week they had no choice. Rate cuts, after all, will only add to the inflationary trend.

The September “dot plot” showing where Fed members see rates landing over the next 2 years shows a definite trend toward more and faster cuts.

So, what does this do to stocks?

If history is any indication, the market goes up from here.

Only 20 times in history has the Fed cut rates with the S&P 500 at all-time highs. And in each of those occurrences, the market was higher 12 months later by an average of 13.9%

Mortgage rates, which had already priced in this week’s 0.25% cut, have actually ticked up since Wednesday.

Below is a chart of 30-year bond yields:

Following the record-setting negative jobs revision, yields came down in anticipation of a September rate cut by the Fed.

After hearing that cut would be 25 bps and not 50, yields came up by 0.10% the following day. So don’t expect lower mortgage rates until we see more cuts.

What we are likely entering now is a period of what’s known as stagflation. This is when you get stagnant economic growth but high inflation.

It’s not a good thing. And investors need to be prepared.

The last time this occurred in the US was in4 1970. Unemployment rates were above average, GDP growth was minimal, but prices were rising faster than usual. So, things got more expensive, but people were not making more money.

Right now, GDP is growing at a 3% clip. This is interesting given the weakening jobs numbers. As you can see below, the unemployment rate has been trending upward for the last 12 months.

My guess is that AI and other new technologies are making American workers more efficient, so even with fewer people in the labor force, they are still able to produce more goods and services.

And the cherry on top?

All of this is happening while stocks are trading at the highest valuations in history.

Using all traditional valuation metrics – P/E, P/B, P/S, Market Cap/GDP – today’s stock market is the most overvalued in history.

 This is a dangerous formula…

Strong GDP growth pushes stocks higher. Rate cuts, which we are expecting 4-6 more of over the next year, also make stocks go up. So does inflation which remains above average.

So, unless we see massive productivity growth in the age of artificial intelligence, it is hard to imagine a scenario that does not lead to an epic market crash.

It happened in 1929. It happened in 1999. And it is likely to happen again sometime this decade.

Will we see a crash next year? Unlikely. The data points to higher prices and every macroeconomic factor confirms that trajectory. But it will happen eventually.

Don’t let this scare you. There have been 18 bear markets since 1929, and we have recovered from every one of them. The next will be no different.

When conditions sour and the party comes to an end, we will let you know. Until then, put your foot on the gas, make some money, and let’s party like it’s 1999.

Best wishes for your trading,

Good evening, and welcome to this week’s edition of Stealth Trades!

After a volatile few days of trading last week, stocks came ripping back to tack on 2% for the week.

The Nasdaq and S&P 500 both made new all-time highs today.

The home construction sector is holding strong, but we are also seeing “risk on” movement as solar, crypto and quantum computing stocks showed tremendous strength this week.

Instead of wasting time on lengthy analysis, I am instead going to share some of my favorite stocks in a few of the hottest sectors.

Quantum Computing

D-Wave Quantum (QBTS)

I shared this trade idea in Tuesday’s “Two Trades in Two Minutes” YouTube video, recommending a buy above $16.50 on a breakout. That triggered yesterday and then surged another 8% today. This was a clean breakout on above-average volume that should lead to a re-test of the highs and potentially new highs.

Quantum Computing (QUBT)

This chart is nearly identical to QBTS above but, believe it or not, these are different companies and different stocks.

Personally, I would trade one or the other. Both are pre-profit firms with almost no current revenue, so they are purely momentum trades.

Roblox (RBLX)

Roblox has been a market leader for the last year and a half, and it has tripled since November.

The stock finally took a breath in August to consolidate and absorb the move, but it looks poised for another rally on a move above $136.

Nuclear Energy

The nuclear sector has cooled, and Wall Street appears to be consolidating their bets. 6 months ago, every nuclear stock on the exchange was surging. But today funds are getting more selective and homing in on the ones most likely to succeed long term.

SMR has been one of my favorites for the last few years, but it has completely run out of steam. OKLO, on the other hand, is pressing against its highs.

Oklo, Inc. (OKLO)

I initiated a small position in this stock on Thursday at $80. I also placed a limit order to buy more at $75 since I was/am hoping the stock consolidates a bit more to absorb more supply before beginning its ascent.

That $75 buy may or may not get filled. In a perfect world, I’d like to see OKLO come in and trade tight in the $75-$80 for a week or two and then rip to new highs.

Cameco (CCJ)

Uranium miner, Cameco, also looks strong. After a failed breakout attempt on August 29^th, the stock pulled back into its base and continued to compress.

CCJ looks poised for another run higher.

Interestingly, we are seeing stocks rally alongside precious metals. This is historically rare since they tend to move inversely. Gold and silver have long been viewed as a hedge during uncertain times.

But the US federal government has proven they are unable to cut spending in any meaningful way. And investors are starting to see the writing on the wall. Debt continues to climb, and Uncle Sam will be forced to keep printing money at an ever-accelerating pace.

This means two things – inflation and a devaluing of the US dollar. Both will cause demand to weaken for government bonds. And with $37 trillion worth of federal paper already out there, investors are beginning to look elsewhere for stores of value.

That, in my opinion, is why we are seeing such a powerful rally in gold and silver.

Mining stocks typically make exaggerated moves in the direction of metals. Since their profits are leveraged due to mining costs, even a 10-20% rise in gold can cause these stocks to double. So, it is unsurprising that miners have been one of the strongest performing areas of the market this year.

The VanEck Gold Miners ETF, GDX, is up 27% from where I bought it in my retirement account in August:

MP Materials (MP) is a rare earth miner securing huge deals with the Department of War and other major players.

It just touched the 50-day simple moving average (yellow line on chart below) for the first time in months.

This is a great place to make a pullback buy on what has been a monster mover.

Trend followers looking to hitch their wagon to a winner may consider Sandstorm Gold (SAND), Coeur Mining (CDE), Iamgold (IAG) or First Majestic Silver (AG). All are showing tremendous relative strength and showing no signs of slowing down.

We can walk through these in greater detail in Monday’s live trading session. We have begun hosting these on YouTube to deliver a better viewer experience and your feedback has been positive.

Here is the link to join Monday’s session at 9am ET: https://youtube.com/live/DCAkq6BHivQ

I hope to see you there.

Best wishes for your trading,

Good evening, and welcome to this week’s edition of Stealth Trades!

On July 10^th, I called a BUY in Bitcoin.

It was emerging from a classic breakout pattern. The stock market was full steam ahead. It was a “risk on” environment.

It should have run 40-50%…

But it didn’t.

BTC rose nicely for 2 days, but that was it. No follow through. No rally to 140k like I was expecting.

After a few weeks I sold my position near breakeven. And after taking a step back on the chart, I probably should have known better.

Below is a daily chart of Bitcoin from January 2023 to present.

I put it in logarithmic scale in order to equalize the rally heights.

You’ll notice a very clear pattern here…

Big move higher, followed by a 6 to 12-month consolidation, leading to another big move higher.

The July breakout was to be the 4^th such move. It was late in the cycle. And betting on another burst higher was a low odds bet.

Most stocks (or cryptocurrencies in this case) see 3 to 4 rallies during a Stage 2 uptrend. If you can catch the first one, you will make a lot of money very quickly.

That’s what we did with SMR and OKLO back in May when the market was just coming off the bear market lows.

The second breakout, assuming you are still in a healthy bull market, can be equally powerful.

The third one is a little riskier. Your odds of success go down a hair and the percentage move is generally a bit less, but I will still take them.

After that though, the odds go way way down.

Fourth and fifth phase breakouts have a much higher failure rate. In hindsight, I should have focused on other stocks in earlier Stage 2 advances. Or just sat out until new opportunities emerged.

Sometimes, the best trade you can take is to stay in cash.

This is a tough one for me. I hate seeing my money sit idle. I want to find a new opportunity to keep the compounding going.

Lately I have been focused on the solar, homebuilding and building materials sectors. These have outpaced others over the last few months and appear to be emerging as new areas of leadership.

I took a position in Shoals (SHLS) last week on this breakout through $6.50.

It showed initial strength but has failed to follow through.

Today we got news that core CPI came in at 2.9% which is the highest we have in six months. This is also the Fed’s go-to inflation metric, casting doubts on a September rate cut.

This took a toll on the indexes Friday and stalled rate-sensitive stocks like lenders and homebuilders.

I hope to get more clarity from the market after the September 17 Fed meeting. If Powell decides not to cut, we will likely see a short-term pullback of 5-10%. A 50-basis point cut, on the other hand, would send stocks soaring.

Once again… Powell holds the reins.

Best wishes for your trading,