Investing Podcast
Ticker Tape Teachings: What This Trader Learned From
Decades At The NYSE
Feb 29, 2024|JUSTIN NIELSEN, MIKE JUANG, ALEXIS GARCIA
From "fat-finger" trades of the decade to the big
names moving off the Dow Jones Industrial Average. Jay Woods, chief global
strategist at Freedom Capital Markets, joins Investor's Business Daily's
"Investing with IBD" podcast to talk about going from a trading desk
internship to Goldman Sachs and beyond. Learn the positives of healthcare
investing in HCA Healthcare (HCA) and Stryker (SYK), and why DocuSign (DOCU) is
not to be ignored.
00;00;00;00 - 00;00;30;08
Unknown
Hello and welcome to another episode of Investing with IBD podcast. That's
Justin Nielsen your host, and it is February 28th, 2024. As we are taping this.
And joining me, as always, is Irusha Peiris. He is from O'Neil Global Advisors.
He's a portfolio manager and analyst over there. And for those of you that are
watching this, the day that it drops, you might notice a little funny,
something on the calendar there.
00;00;30;08 - 00;00;56;15
Unknown
It's February 29th for you. It's a leap year any any leap year plans there.
Irusha No, I don't even realize leap year until right until he said something.
Well, I just know how much you watch your calendar this year, so. Well, and,
you know, Hey, look, we've got an extended month, so if you're feeling a little
bit cozy with this extra time, pull up a chair and make yourself comfortable
because we've got some stories straight from the trading floor of the New York
Stock Exchange for you.
00;00;56;17 - 00;01;17;26
Unknown
Joining us now, a first time guest for us is Jay Woods, chief global strategist
at Freedom Capital. And he's also got these CMT letters behind him, chartered
market technician. I could say that for a rush as well, but I just don't want
to because I don't want him to get his head bigger. Of course, you might
recognize Jay from his appearances on CNBC.
00;01;17;26 - 00;01;34;02
Unknown
BLOOMBERG Gosh, he's he's been all over the place. So. Jay, how are you doing?
It's great to have you on here. I'm doing great. Thanks for having me. I'm
excited to be here. Yeah. Awesome. Well, you know, I think you're so in tune
with so many of the guests that we've had, you know, all of our guests. You're
friends with them.
00;01;34;02 - 00;01;54;24
Unknown
You've worked with them for a long time. But I think a lot of our listeners
don't really know your story. So tell us how you got started in stocks. I got
started in stocks by, you know, as an eight year old, getting two shares of IBM
from my uncle, who happens to be a famous technician by the name of Ralph
Acampora.
00;01;55;00 - 00;02;11;00
Unknown
And he gave me these two shares of IBM and said, You just have to do one thing.
You have to chart them on a weekly basis. So high, low, close, high, low,
close. Did this for two months. He comes down to visit me. I grew up in
Philadelphia. He was in the Bronx. And I go, Hey, Uncle Ralph, what am I doing
here?
00;02;11;06 - 00;02;32;00
Unknown
And he drew a line under it and he said, What's it doing? I go, It's going up.
And he goes, That's an uptrend, kid. And that was my foray into technical
analysis. It didn't really take right away. I went to Fordham University,
wanted to go to law school until I needed an internship, and I was blessed to
get an internship in the industry and I was on a trading desk.
00;02;32;00 - 00;02;55;03
Unknown
I wasn't looking at charts, I was looking at traders and it was yelling and
screaming. Just like in the 1987 movie Wall Street. Right? That was euphoric.
And I had a great time there. A firm called Sherwood Securities that doesn't
exist anymore, but that gave me the bug. And then I went back to the charts and
I parlayed that internship to a job on the floor and I it on the floor in 1992.
00;02;55;10 - 00;03;16;11
Unknown
And I haven't left. My roles have changed. The market sure has changed. But to
be a part of that NYSE community, as long as I have, has been the greatest
blessing in my life. And the life lessons I continue to learn to this day have
been invaluable. So you're talking about lessons. What were some of the biggest
lessons you learned while working on the floor?
00;03;16;14 - 00;03;36;06
Unknown
Well, the floor I learned how to get lunch. I learned how to take orders. It
was a different world. In 1992, our training on the floor. You don't do this
anymore with human resources. But the training was like the Karate Kid movie.
The good one, the one with the not the Will Smith version, but the issue was,
well, I talk to young kids that they don't know that.
00;03;36;08 - 00;03;56;13
Unknown
That's true. That's cool. Yes. Yes. So, you know, my training of waxing the car
and painting the fence was get lunch for these ten different brokers in these
ten different stocks with these ten different attitudes and get it right
because you can't get the lunch right. How on earth are you eventually going to
trade in a crowd with ten different personalities, with ten different firms and
ten, ten different stocks?
00;03;56;15 - 00;04;14;25
Unknown
And if you can't handle lunch, you're not going to be handled a trading crowd.
So that was my foray into it. You spend years in college, you come out, you're
like, whoa, But that community, the this the way they taught you, the way they
brought you up, you learn the hard way, but you paid your dues and it was
fantastic.
00;04;14;25 - 00;04;30;27
Unknown
And I've been there through changes. We started in eight, then we went to 16th
and then when we went to 16, the old school guys, we're out of here. They're
cutting half my profits. Then we went to pennies and another. We've left
technology ramped up. I was able to pivot and embrace the technology when it
got my seat.
00;04;30;28 - 00;04;52;18
Unknown
1998, I was that young kid that knew how to deal with this stuff and it flowed.
And then the technicals really incorporated into my trading skills and I then I
finally did a deep dive studying into that because when you're trading minute
by minute, second by second on the floor, I better know my levels before I get
down to their trading floor.
00;04;52;22 - 00;05;07;20
Unknown
So I'm prepared for the day. Now technicals, if this then that and I was always
ready to pivot and then if I had a crowd of five hungry buyers in front of me,
I knew the stock was going to go up. I could rip the chart up right now, but
where do I want to sell? How do I want to handle it?
00;05;07;22 - 00;05;33;05
Unknown
That is the one thing that's remained constant. We we've gone
industrialization. We trade by anchored view up with Brian Shannon what he does
if you're trading minute by minute, if you don't know VWAP levels then you're
you really behind the eight ball. I was able to evolve and then after COVID,
unfortunately, things changed again and we lost. To put it in perspective, my
firm specialize in Kellogg was taken over by Goldman Sachs.
00;05;33;08 - 00;05;56;16
Unknown
We had 330 employees in our height of employment in 2005 because of
enhancements to technology, we didn't need to teletype every order. We just
zoomed them in. We got rid of the clerical staff, we got rid of the support
staff, and no one was getting us lunch anymore. We went from 330 people down to
15. By the time Goldman left the business in 2014, I survived.
00;05;56;18 - 00;06;03;22
Unknown
I was able to adapt and have alliances. And yes, Jeff Probst, Survivor was my
favorite show.
00;06;03;24 - 00;06;25;08
Unknown
I played a real life game of it, but I was able to evolve. And then after
COVID, my firm left the business again. And then I had a chance to pivot and I
was doing some social media media stuff on smaller networks like a Yahoo
Finance. I had a lot of friends being at the epicenter of the financial media
world, being on the floor of the New York Stock Exchange.
00;06;25;14 - 00;06;47;18
Unknown
You meet everyone. All these people on CNBC were my friends. Bob Zani asked me
to come on air to fill in for Art Cashin once, and I my heart just sank and my
firm said no. So when the pivot came, I went to a firm that enabled me to talk
not just to customers, not just to people that want to become financially
literate, which I do a lot of, but to talk to media.
00;06;47;18 - 00;07;09;27
Unknown
And that's really taken off. And now I get to work with a great group here at
Freedom where I get to talk to clients, customers, write weekly and talk about
the marketing to do it on TV with people I've been comfortable with my whole
life. It doesn't feel like work. Don't tell them that. But it's fantastic and
I'm really reinventing myself again.
00;07;10;00 - 00;07;27;22
Unknown
And the tentacles now are more long term, but with tentacles I can go short
term. I would keep this smock, kind of go into a trading crowd tomorrow if I
could. I miss it. I miss the open outcry. But now it's all algorithms and it
tends to be slow and boring. So I'm not slow. I'm definitely not boring.
00;07;27;27 - 00;07;42;21
Unknown
So to be able to get out in front and tell a story about different stocks, I
like sectors I like and the market itself, it's taken off and I'm very happy it
has. And you know, it's been a good day. We'll see what tomorrow brings,
because that's the one thing I hope you never have guessed that. Come on.
00;07;42;26 - 00;07;58;27
Unknown
And you didn't promote me this way. And I thank you for that. This guy seen it
all. That's what's amazing about working at the New York Stock Exchange.
Amazing about being in the financial industry. You don't know what the next
day's going to bring. I didn't know Snowflake was going to trade down 50 after
hours today. For now, I'm watching levels.
00;07;58;27 - 00;08;17;17
Unknown
I'm watching that 200 day moving average. Does it do what Palo Alto Networks
does? Is Nancy Pelosi buying is a job for you beforehand? I don't know. But
that's what makes it exciting. And to get to talk about it and then share
stories, I mean, it's a dream come true. Yeah. Yeah. You know, I would just
very quickly, Jay, you're just the whole story.
00;08;17;17 - 00;08;42;07
Unknown
The recollection of reinventing yourself really reminds me of some of the
classic great growth stocks that we have in our model books, where if you think
about an Apple went from computers, the iPod, the iPhone, the iPad to like
everything right? Or Netflix went from DVDs of streaming to original content,
you adapt or die, right? You're reinventing. I mean, in many ways that's that's
what you've done for 20 years.
00;08;42;07 - 00;09;01;08
Unknown
And I mean, it's pretty pretty incredible. I mean, how did you get that flux
like when you were in real time? Were you thinking, like, I better learn this
now or I might yet lose my career or whatever? Well, the financial crisis and
you mentioned Netflix. That's a great example of a stock that I thought, my
God, what are they doing?
00;09;01;08 - 00;09;22;00
Unknown
I want my DVD in my mailbox. This is ridiculous. Talk about missing a huge
opportunity to buy a stock. I think that was down like $50 when that analogy
came. There have been different pivots, different changes. To me, it's all
about relationships. I think those are the most important things. And over the
long term, those relationships that I made, that's what helps me get onto
television.
00;09;22;00 - 00;09;41;19
Unknown
That's what helps me meet and branch out and create this brand that I guess
I've created for myself. But living through the financial crisis, people ask me
those questions. How did you adapt? How do you just you stayed off the radar.
You just did your job, you didn't cause any problems. You were respected on the
floor. I worked my way up the ranks.
00;09;41;19 - 00;10;01;20
Unknown
They have a different hierarchy down there, floor officials, governors. And
then whenever I was a director and your peers get to vote on you for that, that
was the biggest distinguished moment of my career becoming that ultimate, that
red stripe, one of six people to represent the floor in matters of the floor.
So we went down from 330 people to 15.
00;10;01;20 - 00;10;16;21
Unknown
And all those people, they taught me the lessons along the way and I miss them
dearly. That was a part of my life. And everyone should be some positively some
negatively. Some told me what not to do, how not to be. You take the good, you
take the bad, you take them all. And there you go. You have the facts of life.
00;10;16;22 - 00;10;44;20
Unknown
Now. There you go. Well, you know what? So because you saw, you know, some
pretty dramatic changes, you mentioned that you got your heater seat in 1998.
So if I remember correctly, was it in like 2000 that the expansion happened to
five rooms on the NYSE and then and, you know. Yeah. So so I mean, because I
remember when I was there, they had just expanded to the fifth room and, you
know, the first time I was ever on the floor and it was they had expanded the
fifth room and it was it was crazy.
00;10;44;20 - 00;11;06;03
Unknown
I mean, they, you know, still were using paper, but, you know, they had the the
big huge tablets that they were carrying around with them. And then you saw it
kind of dwindle. The rooms come down. It became a little bit more of a CNBC set
than it did on the trading floor. So with the algos, you mentioned the algos
come in and the technology and everything like that.
00;11;06;05 - 00;11;26;26
Unknown
How did how did that change your, I guess, sense of from the open outcry, the
psychology, the the sweat that you could actually smell, you know, when when
there was fear in their eyes to, okay, now it's just all being done by
computer. Well, that's that's where the technical analysis really came into
play because you had humans in front of you.
00;11;26;26 - 00;11;45;15
Unknown
You could see human behavior. You could hear a buzz on the floor of the New
York Stock Exchange. You walked the floor. Now you hear humming of computers.
You don't know if the Dow was up 200 or down 200 back then. You knew you could
tell by the attitude, tell by the smell in the room. So the technicals are what
always gave me a little advantage.
00;11;45;15 - 00;12;04;10
Unknown
I credit it to why I went from 330 and survive to 15. I was always one of the
top producers. I was always somebody people could talk to because they didn't
understand the charts. What levels are you looking at? J And I would tell them,
it was technicals. There's always if this then that. So I would get them
prepared.
00;12;04;10 - 00;12;35;05
Unknown
If it does this and be prepared for that. And being on the floor risk
management, which is always job number one, Job number two and job number
three, each other before his launch. But job number one, two or three is risk
management. Technical analysis is the perfect tool for that because if
something changes, you have to change. I'm not going to just watch the computer
screen and get run over because something broke out of bubble level or, you
know, we had a little cross from the undersold oversold to just back above 30
on the RSI where you can use border bands.
00;12;35;05 - 00;12;55;20
Unknown
I used every little indicator, anything that I thought gave me an edge, but the
technicals are what really help me explode my career from a trader and made
myself more relevant to the trading community. Because not everyone understood
this and I had a good understanding to grasp and I could talk about it in a way
that was relatable to many people.
00;12;55;20 - 00;13;12;02
Unknown
Come on, and I can do it too. I could talk about each chemical cloud again and
and Fibonacci levels all you want. You know, you want to go there and let's go
there. You know, I realized when you're talking to people, when I do these
shows, I do it for an audience of one. That's my mother. My mother can
understand what I'm talking about.
00;13;12;08 - 00;13;30;10
Unknown
I'm doing a good job. I know you guys can understand it, but I want a general
audience to have an idea. Okay, We want to buy it. If it does this, this is how
we do it. This is how we manage risk and then make the trade their own. I'm not
here to give advice and then, you know, get yelled at for being wrong or
praised for being right.
00;13;30;16 - 00;13;48;12
Unknown
I want people to know the setup, what they're getting into and how they should
play it once they do. But knowing first and foremost, manage risk. And maybe
that made me a very boring person, a scary person, because when I bought
something right, I still I think of the downside before I think of the upside.
Am I going to cost average into this trade?
00;13;48;12 - 00;14;05;11
Unknown
What am I going to cut bait? There are so many different structured products
and stocks you can trade. Don't get married to one and too many people didn't.
I saw too many people blow up over there. Yeah, you know, and I got to credit
your Uncle Ralph because he is such a genius in terms of keeping a lot of the
things simple.
00;14;05;11 - 00;14;23;00
Unknown
And for those people that don't know, Ralph Acampora, of course, is he's the
one that kind of started the CMT program, the chartered market technician. And,
you know, when he was on our show not too long ago, I mean, it was like, hey,
is it in an uptrend or not? You know, are there higher lows? Are there higher
highs?
00;14;23;04 - 00;14;46;18
Unknown
It's, you know, sometimes just that simple. So they're very good stuff. Arusha.
What what what did you have? Yeah, well, first, you know, Ralph is the
godfather. So given what I want when I was also my godfather. So full analysis.
I don't know. Yeah, but Jay, talking about the indicators, you know, after you
learn because especially going through the CMT program, you learn about tons
and tons of different indicators and they're all super cool.
00;14;46;20 - 00;15;03;18
Unknown
Well, how did you evolve? Did you, did you find yourself after using them a
number of years that you kept them or did you reduce and try to simplify? How
did you evolve during your time? no, I keep evolving with those indicators. I
try to keep it simple. So I was blessed when I studied for my CMT exam.
00;15;03;18 - 00;15;15;24
Unknown
Guess where I was? I was on the floor of New York Stock Exchange. Well, guess
what I did? I was a market maker. I had access to buy and sell stock like no
one did. Was it really my money? But I treated it like it was and I was buy a
stock based on we're studying Bollinger bands band.
00;15;15;26 - 00;15;48;28
Unknown
Okay. It just broke above the midline of the Boulder band. It's out of the
whole of your band coming back in. I would test different indicators every
single day, one to help me study for the exam and to put it to work. That's the
only way you really learn is if you kind of put it to work. So paper trade,
write notes as you're doing these indicators, the indicators that work for me,
the simplest ones or Mac D crossovers with your RSI levels, especially when
we're oversold, we go to, you know, when we're oversold and we go back, we're
oversold, we go back below 70.
00;15;49;03 - 00;16;14;19
Unknown
I probably want to sell it oversold. Does it mean you have to sell the stock?
It means it may be getting a little toppy here or trend sideways for a little
while. So those are the simple ones moving averages and VWAP trading. My
relationship with Brian Shannon started in CMT when I brought him to the floor
of the New York Stock Exchange when I was on a panel and I said the biggest
change in the industry is people don't care about price when they come in and
they ask me, How's IBM look this morning?
00;16;14;23 - 00;16;32;19
Unknown
They don't care. It's down to dollars. They want to know the volume. 20,000
shares. Here's 2000 shares to buy. I just want to be 10% of the volume. So I go
up right down and he sat with me as we opened IBM, ironically enough. And he he
was floored. Then all they cared about was volume. Everyone was volume
weighted, average price.
00;16;32;24 - 00;16;51;06
Unknown
And, you know, I will take a little credit. Brian said nice things about me in
his book. I was part of the inspiration for him to write that second book,
which he had to do because he was onto something so big. So any day Trader
Swingtrader that's not using average volume weighted price, then they're
missing out because that's what everyone does.
00;16;51;12 - 00;17;08;14
Unknown
And the thing that scares me because only price pays is when I was trading on
the floor, you know, your job was it to be average. Your job was to do very
well. I didn't go the average, but the way people execute stock, if they're
average or God forbid, they beat it by a penny, you did a great job.
00;17;08;14 - 00;17;27;15
Unknown
You're getting rewarded with more order flow. It's hard for me to fathom, but
that's the way it is. And so if you don't know your VWAP levels and you're not
following that, you're missing out on what's really happening behind the
scenes. And then algorithmic trading rocket stocks that stop to the penny on 50
day and 200 day moving average.
00;17;27;15 - 00;17;46;01
Unknown
It floors me that it's happening like an apple. This week it rallied on the
news that they're not making a car Don't get me started which rallied on that
news where did it rally up to a flattening 200 day moving average to the penny
and then it came in. Tell me that's not algos behind the scenes. That's
amazing.
00;17;46;01 - 00;18;02;05
Unknown
Yeah, absolutely. Well, when we come back, we're going to talk a little bit
more about the macro side of things since we've kind of covered some of the
technical parts. So stay tuned. We'll be right back. Welcome back to the
Investing with IBD podcast. It's Justin Nielson here, your host, along with
Irusha Perez, who joins me every week.
00;18;02;05 - 00;18;21;27
Unknown
He is a portfolio manager and analyst at O'Neil Global Advisors. And our
special guest this week is Jay Woods. He's chief strategist, market strategist
over at Freedom Capital Markets. And, you know, he's been on the floor of the
exchange for a long time. He's seen a lot, but as he mentioned, he hasn't seen
it all. So let's talk a little bit.
00;18;21;27 - 00;18;45;29
Unknown
We've been chatting about charts and the psychology and everything. Let's kind
of step a little bit back and get your perspective on the markets and kind of
that macro element, because so many people, it seems like, have been paying
attention to interest rates and inflation. And, you know, everyone started
turning into the macro expert. I mean, Joe Fahmy kind of jokes all the time,
you know, when when everyone's looking at macro, that's when, you know, you're
in a lot of trouble.
00;18;45;29 - 00;19;07;10
Unknown
So what's what's your take on the macro? How important is it? And, you know,
we've got a PC report that's probably going to be dropping at the same time as
this podcast. Yeah. So that's that's our next thing that we have to contend
with. So what's, what's your take on it all? Yeah, well, of course it's
important, but it doesn't always mean we're going to react as the macro
environment suggests.
00;19;07;10 - 00;19;28;00
Unknown
We may want to react. I remember coming in to all the way back to December that
people started calling for six rate cuts, which I never understood, and I was
always in that camp. I don't know where those numbers came from. And the
S&P was trading at 4800 and now the ten year was under it was three and
three quarters percent, 3.75.
00;19;28;02 - 00;19;53;05
Unknown
And now where are we were just under 5100 in the S&P. We're not calling for
six rate cuts. We're calling from 83. Still anxiously awaiting what data will
come out. Could be the PC that says, all right, they've got inflation under
control. This soft landing narrative is back on the table and we can cut a quarter
point because our hikes are they did the job they were supposed to do.
00;19;53;07 - 00;20;16;05
Unknown
I am just following the price action. And two things had me very interested
when we talk about watching, you know, the overall narrative of inflationary
narrative, the CPI and the FOMC meeting, the FOMC meeting, what was it, three
weeks ago at this point when Powell was talking and they weren't cutting rates
and it didn't look like they're going to cut rates anytime soon?
00;20;16;10 - 00;20;33;18
Unknown
What happened in the market? The S&P 500 sold off one and a half percent.
What did we do? This was three days after that. Everyone was looking, my God,
this is it. They're not going to cut. We thought we made it back. And the
tapering spike and that is what's important. The ten year is gradually trading
higher but gradual.
00;20;33;23 - 00;20;58;25
Unknown
So we're not seeing those big volatile moments that's causing the equity market
to get jittery. And then let's go to the CPI, which is the one data point that
does move markets. I know the piece and we'll get to that in a second, is the
Fed's preferred inflationary measure. But the CPI moves markets. We've seen
pivots, we've seen key reversal days going back to October, a year and a half
ago, where the CPI was what did it.
00;20;58;27 - 00;21;16;16
Unknown
We were down another one and a half percent. The CPI came in a little hot.
People are okay. Now we're you don't have to cut rates now. We have to kind of
now could they raise rates again? Who knows? But the market got jittery for a
day and then we only made it back. And then it was about Nvidia's RTX and
Nvidia.
00;21;16;22 - 00;21;36;18
Unknown
Is it going to follow Palo Alto Networks? No, it didn't. It did. Well, in my
God, they just continue to crush it on all cylinders. And maybe that saved the
markets. I heard somebody say today, I think that's ridiculous. One stock's not
going to crush or shave the market. It will dictate a move over a few days, but
it's not going to be the be all and end all.
00;21;36;18 - 00;22;02;24
Unknown
And then tomorrow, the PCI, the Fed's preferred inflationary gauge, we're
looking year over year to go from 2.9 down to 2.8 continued progress overall on
the inflationary front, these data points CPI, BPI, PCE, they've all trended
lower when they come in hotter, the overall trend is still trending down. So
we're still landing this plane, but we're not doing it as quickly as the six
rate cut.
00;22;02;26 - 00;22;25;27
Unknown
We're going to do so. But the S&P 500 is making a new high every single
time These numbers come in a little hotter than expected. All follow price
action. And yes, I'll be nervous at 830 when this number comes in. If it comes
in hotter than expected, what are we going to do? Sell up one and a half
percent while we kind of have that built in based on FOMC and CPI?
00;22;25;29 - 00;22;50;01
Unknown
Will we go down 2%? We haven't had a 2% drop yet in the S&P 500 in 85 days.
That is a pretty long time. I think it was bespoke that had a stag since like
1970. We we've had very few days over 70, only five times where we've gone 100
days without a 2% pullback in the S&P 500.
00;22;50;06 - 00;23;09;06
Unknown
It's coming. I mean, but we're streak in right now let's enjoy it. But this
economic data, yeah it's going to make headlines because there's nothing else
going on or we're 90% done earnings season coming into this week so the
catalyst that can take us higher. Is it the PCE? I don't know. I don't know
what the next catalysts just take us higher.
00;23;09;06 - 00;23;28;19
Unknown
So I'm in the camp that we may have peaked out for the near term seasonally.
You look at it and Randy Diedrich had a great tweet which I retweeted this
morning. We are in that presidential cycle where we should pull back. We've had
a tremendous run. Let's bring it back. And then what is led over the last three
months, this is the thing that shocks people.
00;23;28;26 - 00;23;54;05
Unknown
You go back three months, the S&P 500 is up 11%. The Dow is up 10%. NASDAQ
composite up 12.28%. NASDAQ 100 up 12.25%. The Russell 2000 up 14.29%, is still
leaning right now. And people don't believe it. They they're so focused on
these seven stocks that narrative has passed us on. There are great stocks
there. I mean, the video a matter of my God.
00;23;54;08 - 00;24;15;27
Unknown
But right now we're going to look for inflationary numbers tomorrow. If they
come in cooler than maybe we'll talk about a let's let's put the June definite
cut on the table and may it could happen as well. I don't know. But it's going
to be interesting to see. It's going to be interesting how the market reacts
and a pullback to me.
00;24;16;02 - 00;24;36;09
Unknown
I kind of expected and we have levels technically where the market should get
buyers and we've seen it down one and a half percent twice now. And then you
look at where we've come from, maybe psychologically 5000 new floor and not the
ceiling. It didn't really last as a ceiling very long. And then you've got
rising 50 day moving averages of train lines.
00;24;36;12 - 00;24;58;03
Unknown
These are all normal things. So a 5% retracement, I don't think that's a big
call to make. I think that's normal market behavior. But the way the market is
trending, the seasonal factors, we should get some sort of pullback. We should
get it soon. And maybe the PCE is the catalyst for that tomorrow. Now, Jay, in
many ways, this has been kind of a lock out rally.
00;24;58;05 - 00;25;25;20
Unknown
What's kind of the sentiment that you've heard, you know, after talking to so
many people over the last few months, you how was that sentiment during that
time as this market just kept crawling up? Kept crawling up is the sentiments
frustration? And those are some of the toughest markets as a trader to trade
because you're seeing the data points, you're reading the headlines and you're
discounting price action and it doesn't make sense.
00;25;25;20 - 00;25;44;26
Unknown
Why did we only sell off one day, one and a half percent, then one day one and
a half percent? Where's the follow through? This doesn't make sense to me, but
underneath the surface, the breadth has been mixed. But the stocks that make up
the Russell, 49% of the Russell is made up of the XL lot. The XL, the missing
looks a lot.
00;25;44;28 - 00;26;16;27
Unknown
I sell for real. It's it's health care and XLB The regionals have held it back.
But in the health care space, biotechs are a big part of that. And guess what?
Just broke out two days ago. Biotech. So the sharpest rotation is happening.
And here here's a fun stat for you. A week ago, two weeks ago today, today
being Thursday when this airs, guess what, ten of 11 sectors in the S&P
select ETF sectors were up, One sector was down, it was technology that to me
said thing is change.
00;26;16;27 - 00;26;35;13
Unknown
Technology was down and everything was up. Okay. The market didn't really
skyrocket because technology is so heavily weighted in the S&P 500. The Dow
stocks in the technology sector were down point wise at eight hertz. I think
UAH may have been down that data the biggest weighting in the Dow, but overall,
all ten of 11 sectors up. It's not technology.
00;26;35;13 - 00;26;57;08
Unknown
Something's changed. And I want to be part of that change. So I look at
materials breaking out. I look at industrials, already broken out, Health care
breaking out. Yeah. You know, biotech, there are some strong things. And yes,
this is technical. Fundamentally, nothing's really changed. Nothing is huge.
We're still here for longer. We've absorbed it. And maybe this is the new
normal.
00;26;57;08 - 00;27;16;23
Unknown
People have to put an asterisk by Colgate and forget it happened. I'm sorry. We
had the greatest rally during a pandemic, which makes no sense when you sing
that out loud. Right now during the pandemic, even with the greatest amount of
uncertainty. Yes. Yes. I didn't know if I would be old humans would ever come
back to this building behind me.
00;27;16;27 - 00;27;48;15
Unknown
I did not know this. True. But we rallied and he got a little too euphoric.
Now, what we're seeing are retracements, beautiful sauce or bottoms. We already
saw Microsoft rebound go round about break out Nvidia boom, It's way ahead of
the game. But stocks that took a little while to round out are rounding out and
breaking out. I like that And then stocks that have been dogs look at Pfizer
look at Bristol-Myers JNJ they stopped going down stop going down is very
important.
00;27;48;18 - 00;28;07;29
Unknown
And now maybe they based maybe they take another leg lower. I don't know. But I
don't think this economic data point that's going to come out or anything in
the next few weeks ahead of the FOMC meeting are going to scare people to a
point where this bull market run is over. I think it's going to do what we do
when we run very far, very fast.
00;28;08;01 - 00;28;23;07
Unknown
We kind of take a break and we regroup and then the regroup is probably going
to go on the existence of the trend. The trend is higher and the trend is
broadening. I'm very bullish on that. I don't think it's going to run away from
us, but we're going to have opportunities to buy and that's a great thing.
00;28;23;10 - 00;28;39;28
Unknown
Do you think what we're looking at here with the sector rotation, you brought
up the strength in the Russell 2000 and I mean, we were having this discussion
a couple of days ago and the Russell just got stronger, you know, And in the
meantime. But do you think this is more of a rotation, money coming from the
Magnificent Seven?
00;28;39;28 - 00;28;57;22
Unknown
I mean, the Apple you know, Apple and Alphabet are not looking so magnificent
anymore. But do you think the money coming from there into these areas or is
this more complementary, like, hey, this is more back to the lift all boats
that we just haven't seen as much because it's been dominated by magnificent?
Well, we're we're not lifting all boats.
00;28;57;22 - 00;29;16;17
Unknown
There's no euphoria. Sentiment is weak. Traders are puzzled. I don't sense
that. I think this is clearly a rotation. I think that example where technology
is down and the other ten sectors are off, money just rotating out of
technology into these sectors. You look at some of those magic seven names,
Tesla, it's rallying, it's a down trends here.
00;29;16;17 - 00;29;34;29
Unknown
It's giving you an opportunity where again, the money is coming out of these
big names and they're going in the same place. Apple is not going anywhere
right now. I wouldn't if I owned it, I wouldn't sell it and panic and get out
of the name, but it's not going to lead us. And where is the leadership? And
that's what I look for.
00;29;35;04 - 00;30;01;20
Unknown
I don't think it's a tie. It is going to result in, you know, you run into all
boats, but when you look for things, you look for opportunities. The Russell is
still 17% off its all time high. That's an opportunity. It's got something to
reverse. You have mean reversion possibilities in some of these dogs. I don't
like to buy stocks, I mean reversion, but they do happen and you may see money
going to those places and then the cash on the sidelines, there's a record
amount.
00;30;01;20 - 00;30;21;10
Unknown
I think we're six and a half trillion. Last time I I took a peek on the
sidelines. People need to get into this market some people are into Bitcoin.
We've seen what Bitcoin has been doing now that it's legitimate by the S.E.C.
because of its ETFs. And Etherium looks like it's poised to do the same thing.
So there is a reallocation of assets.
00;30;21;14 - 00;30;41;24
Unknown
There is some money on the sidelines coming into this market, but this is not a
tide lifts all boats and we're seeing it through earnings season. Those that do
well, you know, they're rewarded now. They look at the after hours. Let's see
if it continues into into morning trading. But they know they don't will do
well or there's big news like a snowflake, like a Palo Alto Networks.
00;30;42;01 - 00;31;14;28
Unknown
They get punished And, you know, they're in pretty strong sectors from what I
can tell. So when Palo gets hit and the other stocks manage to do, they go down
in unison, but they start coming back and tell their own stories. That's
positive. So I think people are being very selective and they're picking their
spots wisely. And semiconductors and cybersecurity stocks, they're still in
early innings is a Dan Ives would definitely tell you and I agree, this is more
of a 1995 moment than a 99 2000 dot com euphoric moment.
00;31;15;05 - 00;31;35;25
Unknown
We're not there. Will we get there? Maybe we do. I hope so. But when we do, I
bet you I'll come on your show and I'll be a little bearish. We will you let us
know when that moment happens and you've got a spot. You got it for you. So
let's let's talk a little bit about levels, because you talk about how
important levels are for you.
00;31;35;25 - 00;31;53;04
Unknown
Do you use levels? You mentioned something like 5000 for the S&P 500. Are
you using levels that much for the for the indexes or are you course individual
stocks? Yeah. So no, I use levels for everything. I mean, the first thing you
do when you when you mention a symbol, I don't know anything about it. I punch
in the symbol.
00;31;53;04 - 00;32;12;15
Unknown
I look at the chart, the chart tells the story. Levels of support and
resistance are basic. Basic? Yeah. Like you say, keep it simple. We talked
about that in the last segment. Yeah. Okay. This is where buyers come in this
year. Sellers come in. Okay. Every time. Russell 2000 is a perfect example, I
don't need a chart to know that it was going sideways for two years.
00;32;12;18 - 00;32;32;15
Unknown
It finally broke out. Yeah. You know, IWM is what we should use for the
Russell. If you want to throw that up for the audience here. IWM 200, which is
Russell 2000 2000. We don't have a hat for that. We do have to pay 500, 5000.
Have those those big numbers or perhaps they really they're psychological.
They're not specific levels.
00;32;32;15 - 00;32;52;14
Unknown
But in the case of the Russell and the IWM, we broke out of a long neutral
range and we went, then we fell and a lot of people were calling for bear
traps. They called this No, it didn't happen, but they didn't put in
perspective. They didn't say, wait a second, it was a 27% move on the October
27 low to the late December high.
00;32;52;15 - 00;33;09;01
Unknown
It retraced to a half percent. That's a third. Okay. That's a normal, healthy
retracement. Right. And where did it hold held in a rising 50 day moving
average every time it was in that chop zone, that neutral zone, I like to call
it jump. So it was above and below all its moving averages. It's what I call a
hot mess.
00;33;09;07 - 00;33;31;22
Unknown
Well, it's kind of got structured to it right now. And from a risk reward
setup, it's great. Use your 50 day, you know, give yourself two weeks and below
just in case you don't want to use it. Exactly. But the risk reward setup is
favorable to a bullish narrative, especially if the IWM can break up up to a52
or 549 I see here and we know it has room to run.
00;33;31;22 - 00;33;53;14
Unknown
It's a lagging index. So if this broadening is happening, you want to be there.
Is it sexy? Hell no. No, I don't want to talk at the bar about stocks in the
Russell unless it's, you know, that happy, super fun stock sky. Right? Exactly.
When it's 1.7% of the Russell of that one up when's the last time that happened
there was a stock or income.
00;33;53;20 - 00;34;18;13
Unknown
So they're going to graduate to the bigger leagues and they'll be out of the
index and Celsius will be your number one holding in the Russell although that
should probably get grad your graduate higher. But you don't really talk about
one specific stock. You talk about sectors when you talk about the Russell and
that's why I like this narrative when I see sectors breaking out that are
predominantly involved in this index, it should lead us higher and use that
rising 50 day.
00;34;18;13 - 00;34;37;06
Unknown
We got down, we tested, we held the guy up, we came down. We haven't made the
new high. We haven't officially broken out, but we're seeing an ascending
triangle and we're going into an uptrend, I believe, and that's the last of the
major indexes that I mean, we can call other indexes, major, if you like that
haven't now haven't gone full circle.
00;34;37;09 - 00;34;56;12
Unknown
We'll go for full circle. Get that 17%. It hasn't got to probably, but you
know, it's not going to happen overnight. It's boring, it's slow. And if the
interest rate narrative stays high for longer, you have a fundamental reason
why they're not coming for small caps. But when we finally get that cut, who's
going to benefit the most small caps?
00;34;56;12 - 00;35;35;03
Unknown
So that's how I look at that setup, and that's how I look at levels and support
resistance or ceilings. Something changes. It goes through the floor. All
right, risk management, get out, Get back in at another time. It doesn't have
to sound so petty and simple, but it really is. If you're just managing basic
risk, if you want to trade these things and we can go into a deeper dive and we
can get our anchored VWAP levels and we we can really have fun with it, but as
an analyst now and not as that day trader, I'm trying to look at the big
picture, take that top down approach.
00;35;35;09 - 00;36;01;02
Unknown
You look at the indexes, then you look at the 11 sectors, then you look at the
stocks that are the most dominant in those 11 sectors. So we're talking energy.
I don't know, Exxon Mobil and I don't know Chevron. That's 45% of the actually
that's what moved it. The industrial is the materials health care. They don't
have that major player it's it so you need more stocks to participate in those
indices for them to rally starting to happen.
00;36;01;04 - 00;36;20;26
Unknown
Well let's talk a little bit about financials because you brought that up
earlier. You know how industrials, financials and health care, 49% of the
Russell 2000. And you know, last year when the whole Silicon Valley bank thing
happened, you know, the regional banks were I think at the time maybe 20% of
the. Russell, you know, I mean, it really, you know, had an effect.
00;36;20;28 - 00;36;40;21
Unknown
The I think the makeup now is a little bit less, you know, maybe closer to 15,
16% regional banks. But it's interesting that even with the New York Community
bank, you know, kind of rumble, you know, and what that's done to regional
banks, you know, because if you pull up CRE, you know, it kind of, you know,
hit CRE again.
00;36;40;24 - 00;37;07;08
Unknown
But even despite that, the Russell is still kind of chugging along, even though
it's got kind of like that, that headwind. So is that, you know, maybe talk a
little bit about that and what that. Yeah. And by the way, just you were spot
on with your numbers there. The regional banks were 20%. So kudos to you. It
was at the end of the year because they have been beaten down so much that
industrials actually took financials as the number one weighting by bias a
skosh.
00;37;07;10 - 00;37;26;14
Unknown
Yeah, the regional banks back last March, that was scary. And it was a moment
that you we kind of seen before. Where do we see that? We saw in the financial
crisis. It really reminded me brought me back to them because you're seeing
banks fail and they were shooting first and asking questions later and
everything was getting hammered.
00;37;26;17 - 00;37;44;10
Unknown
For us, it's an opportunity like, okay, why is Comerica getting hurt there?
They're okay. KeyBank didn't deserve this treatment, but they just shot it. And
then it was I don't remember the one bank. There were two banks that got hit
one day. One came out and said, No, our balance sheet is fine. We had more
deposits this month.
00;37;44;13 - 00;37;58;20
Unknown
It went up and another one went down and all of a sudden they started to say,
All right, let's look at them individually. And they stopped taking them all
down. Just like the tide lifts all boats. The tide went out to sea and the
regional banks went down with them. And then he started a slow process of
bottoming.
00;37;58;26 - 00;38;17;08
Unknown
And then we got another little scare recently and we sold off a bit more. We
haven't made that full roundabout. It's going to take a little while longer
because there still seem to be problems there. I am not the fundamental deep
dive regional bank guy to have on your show to say which banks are going to be
facing problems.
00;38;17;08 - 00;38;40;18
Unknown
You know, mortgage crisis is all these things, but technically they are
something that isn't right. They haven't broken back out the financials that
are winning. Look at Goldman Sachs, Look at Jp morgan, look at Morgan Stanley.
Look at your your what? Your visas and your MasterCards of the world. Wow.
These are strong uptrend, strong breakouts. And we're still waiting on some of
them.
00;38;40;18 - 00;39;01;04
Unknown
Goldman is ready to go up five today. That's where I think the strength is. And
you know, the regionals, they may still take some time to come back and there's
still may be another one or two that have some real estate issues going
forward. So if the regionals were in play right now, yes, that Russell would be
a lot higher than it is.
00;39;01;06 - 00;39;25;00
Unknown
But thankfully, there's enough within the index minus the regionals there that
are doing the heavy lifting, keeping us in that near-term uptrend, hoping to
break us out, maybe the regionals help break us out. They report earlier than
everybody else. So that cycle will start in about 4 to 5 weeks. Yeah. And to
end that segment, Jane, your thoughts on Amazon going into the Dow and Uber
into transports.
00;39;25;02 - 00;39;44;10
Unknown
Right. All right. Yeah, I am a geek when it comes to the history of the Dow and
what stocks were in it. The first thing I did when I got my job we had Wall
Street Journal newspapers, we'd open, we read them and I memorized the 30 Dow
stocks and the Bethlehem Steel and Woolworth's letter Z. These were things
these were the 30 most important stocks.
00;39;44;12 - 00;40;05;21
Unknown
And then they put Walgreens Boots Alliance into the Dow Jones Industrial
Average. And I had a conniption. I never understood what Boots Alliance was. I
thought it was the shoe company is a woman based pharmaceutical company. And
and yet the people there hate me because I say this all the time. But the stock
didn't make sense. Why not CVS, if you're going to go that route.
00;40;05;21 - 00;40;26;19
Unknown
I know CBS I but anyway, I digress. The Dow, they're a little asleep at the
wheel. I want to I want to find out who's on this committee. I want to be on
this committee. I feel I would add value. So if you have conviction, someone in
this audience knows, hey, J was looking to get on the Dow Jones Industrial
Average Committee or the transportation average they put Aweber in.
00;40;26;22 - 00;40;49;17
Unknown
This is why indexing is great because the indexes finally get it right over
those in what's evaluation $90 Billion. What did they kick out? JetBlue the
sixth seventh biggest airline Yeah I mean maybe it's a sixth of the they allow
the spirit merger to happen but JetBlue is out so the index itself is is
stronger and if you're in the index, you're going to do better Amazon more
representative.
00;40;49;17 - 00;41;06;03
Unknown
I know Walmart's going three for one. Probably help the Dow people make that
decision for them. But why did we need Walgreens in there? And yes, there are
people out there that have this contrarian view while he gets kicked out. I
want to buy because they remember GE, they remember Exxon Mobil, but there are
a lot of dogs.
00;41;06;03 - 00;41;25;27
Unknown
They got kicked out that steel and Woolworth. You bought those when they got
kicked out. God bless you. And as you have no money left but Amazon, to me, it
belonged in there. It's something everyone knows. Yeah, I'm $1.7 trillion
company. I prefer my stocks to be at the New York Stock Exchange. But I've
gotten over when Cisco and Microsoft got added years ago.
00;41;26;02 - 00;41;50;08
Unknown
And Intel, there are seven Nasdaq stocks still in it, but that's representative
of what we we are as a country. And those 30 Dow stocks are just important to
me as those 500 S&P 500 stocks you overlap. But I did this on my newsletter
last week, overlap the last 50 years, the Dow and the S&P. I don't know
why, but they do mirror each other, each 30 stocks versus 500 and market cap
weighted price cap weighted.
00;41;50;15 - 00;42;10;06
Unknown
We can go down that road. But when Amazon got put in, I jump for joy. It
belongs in the index. I can suggest other moves too, but that if there's a
stock that is more emblematic of the American, you know, culture, I mean, who
doesn't who's not influenced every day by Amazon? And then I like stocks in
uptrends.
00;42;10;10 - 00;42;32;29
Unknown
This one's got a pretty good one. Talk about stocks that are gone round about
finally breaking out 185 is the all time high there. I want to see it get
there. You know, someone's been selling a lot of stock lately. It's kind of
been the the roof on it. But once once we get through the you know I'm blanking
on the Amazon CEO's Amazon CEO Jeff Bezos.
00;42;32;29 - 00;42;53;00
Unknown
Yeah. How do I figure I'm getting old? Well hey, you know, when he's no longer
important right now that he retired, but he's positioned billions of dollars
worth of this region. So let's get him out of there. You know, and Uncle Warren
is supporting Occidental Petroleum all these years. So yes. Yeah. Support
resistance do have faces behind them sometimes.
00;42;53;00 - 00;43;10;12
Unknown
And right now, resistance in Amazon has been Bezos support Nazi has been
puppets. So you know just a I know this is going to be the end of the segment.
But I got to ask you because, you know, one of the things that people have been
commenting on and you mentioned this, that, gosh, the weighting now in so few
stocks is crazy.
00;43;10;12 - 00;43;32;14
Unknown
And the technology, how important that's become. While now the Dow Jones
Industrials has Cisco, Intel, Amazon, Apple, Microsoft. I mean, it's it's
starting to look a lot more, you know, technology. I mean I guess that is the
industry now. But what's what's your kind of feeling on how technology based
that has become? Yeah. And salesforce.com which reported earnings.
00;43;32;17 - 00;43;54;29
Unknown
Yeah. You know it's it's great still has good old big blue in there. IBM and
IBM looks better than Cisco on an intel I'll tell you that much it you know
they they could change it up a little more quickly and be more emblematic of
the times and IBM could have been kicked out and brought back in. But it is
important they have a strong technology base.
00;43;54;29 - 00;44;23;17
Unknown
But the Dow Jones Industrial, it doesn't really mean industrial stocks. It
would be John Deere, Caterpillar and. Right. And then some defense as well. No,
it's it's really Dow Jones is just the average of the 30 best stocks that are
more representative of the U.S. economy. That's how I look at it. They still
call the industrial average and they want to change your name, change your
name, but that that, to me is still emblematic of what the committee feels are
the 30 best stocks.
00;44;23;20 - 00;44;41;06
Unknown
The fact they finally brought Apple in there in 2013, a long time coming and
Nvidia, they split their stock last time they got this pricey. I had a feeling
that was maybe because it could go into one of these. Maybe you could go into
the Dow that is the leader in the tech give me Nvidia, get rid of Intel.
00;44;41;07 - 00;45;12;10
Unknown
Fine. Get rid of Cisco. Give me anything else. Cisco's done nothing for 2025
years. Look at that chart. You know, maybe it was a monthly. Yeah, maybe Spark
will finally put it over the top. I don't know. And that's a little tongue in
cheek, but yeah, I love watching indices. I love price weighted. Yeah. If you
don't follow up though, and you follow the Dow, then you're misguided because
it's the most expensive, most important stock in the Dow Jones Industrial
average is UAH, UnitedHealthcare the most important stock out there?
00;45;12;10 - 00;45;34;01
Unknown
No, but if you're following the Dow Jones Industrial Average, you better know
what it's doing. And then Intel you don't have to worry about because it go up.
Mario is very solid now. It is like you don't have to worry about it. It's not
going anywhere. You know, I see where the puck is in. The puck is in these
leaders that continue to, you know, bring out new technology, enhance and grow.
00;45;34;07 - 00;45;53;03
Unknown
And some of these stocks are a little stagnant. The Dow, people will eventually
get to them. There's no rush. You know, you don't want to wake them up. They're
sleeping. But I'm happy that they they brought Amazon in and kick Walgreens
out. Very good. Well, when we come back, we're going to talk about a little bit
more in-depth on some of the sector analysis that you started with here into
some individual stocks.
00;45;53;03 - 00;46;10;15
Unknown
So stay tuned. We'll be right back. Welcome back to the Investing with IBD
podcast. This is just Nielsen here, your host, along with a rush of peers who
joins me every week from O'Neil Global Advisors. And our special guest this
week, Jay Woods. He's chief market strategist over at Freedom Capital Markets.
And you mentioned that you had a newsletter.
00;46;10;15 - 00;46;32;03
Unknown
JAY So where was the best place that folks can kind of get some more
information on your thoughts on the market on a regular basis? Yeah, Thank you.
If they follow me on Twitter. J Woods three Jay Y Woods three I Twitter. You
can see my pin tweet, not not in my bio. That's a substack. There's something
different in my pink tweet is the Freedom Capital Markets newsletter.
00;46;32;03 - 00;46;58;00
Unknown
You can click on that sign up every Monday comes your inbox and it's very
simple, just keeping it simple. What are we watching this week? So this week we
were watching the PCG a little in the video hang over possibly. And then now
what? Earnings are on the docket, what economic data is coming. So this week
we'll be talking about stocks like DocuSign and Costco and yeah, it's a fun,
quick little reading your inbox and it gives you perspective what we're
watching every week.
00;46;58;02 - 00;47;17;03
Unknown
Awesome. Well, let's get into some of the stocks that are on your radar right
now. And you you mentioned health care, XLB of course, is the sector spider ETF
for health care and that's that's been looking a lot stronger. You mentioned,
you know, the biomed biotechs. SBI has been looking strong, but you're kind of
going in a little bit of a different direction with HCA.
00;47;17;03 - 00;47;34;10
Unknown
Talk to us a little bit about HCA. Yeah, I want to thank some of the smart
money out there for putting this on my radar. It's something technically that
is broken out that I love. It's reversed and broken out, and it looks like it's
going to tend to trend higher. But what happened last week, 13 filings came
out.
00;47;34;10 - 00;47;54;24
Unknown
Those 13 F's are filed quarterly. There are delayed indicator. It comes out 45
days after the quarter ends. But two people of interest added them as new
position. HCA is now a new position for David Tepper is Apple Lusophone and
Michael Barry you know the famous short selling from the big guy up on Bull
took these positions on.
00;47;54;29 - 00;48;15;27
Unknown
And when I see new positions in the 13 filings, I don't really pay too much
attention, but I will look into them and HCA technically it's got my blessing
full round about gap up breakout flag go again Thank you very much. But what
does HCA do? Let's look under the hood. Let's let's tell the fundamental story,
because I'm sure that's why these smart money investors are in it.
00;48;16;00 - 00;48;38;29
Unknown
It's important employees, over 200,000 people based out of Nashville,
Tennessee, and it's elder care. A primary focus is elder care. I heard this
stat on Josh Brown show the other day. Josh, good friend. The next four years,
more people turn 65 than any other span in our lifetime. This is a growing
demographic. What do they do? They take care of the elder.
00;48;38;29 - 00;49;00;17
Unknown
We're living longer. This is a growth industry. So HCA has got triple blessings
for me. It's got my technicals check, box number one, it's got fundamentals,
check box number two, and then it's got some smart money. I'll throw that in
the check box number three. So the risk reward set up is there. The long term
fundamentals story is there.
00;49;00;18 - 00;49;21;19
Unknown
This is what I believe you can buy and put away because it's going to be very
predominant in its field for a long time to come. Yeah. And it's going
accelerating revenue, right? Six quarters in a row right there. Yeah. And also,
when you look at a monthly chart all time highs, well, it's better than all
time highs, right?
00;49;21;21 - 00;49;45;01
Unknown
And now you look at kind of competition, other other areas that might kind of
disrupt this this stock or, you know, anything like that when you're kind of
doing your analysis. No, I look, what else in that sector will benefit? And how
about some hip replacement striker is probably the A stock that has a great
base broken out.
00;49;45;03 - 00;50;03;10
Unknown
And the longer the base, the higher the space. We pay sideways for a while.
We're just breaking out. To me, this is a name that's had runs in the past and
I believe it's on a nice upward trajectory. It's not going to make headlines,
it's not sexy, it's not going to be focused on financial news that works. But
we're focusing on it here for your listeners.
00;50;03;10 - 00;50;24;16
Unknown
And I think the risk reward setup is great if it fails, if it breaks back below
that old resistance level, which should act as support, you get out, you move
on. But to me, given the fundamental story, the demographic again in the health
care rotation, I think Stryker has a lot of room to run here. And I should
mention that I do own a position in this myself.
00;50;24;19 - 00;50;41;08
Unknown
I think I bought that in January before the earnings. So, yeah, it's something
I'm sitting with for now. And you know what? I think David Keller, when he was
on our show, he. He brought this one up. You mentioned David earlier. So. So.
So, Jay, you can check the smart money box. Stryker Yeah, because David Keller
For David Keller now.
00;50;41;09 - 00;51;02;04
Unknown
Yeah. Yeah. For goodness sakes. So talk talk a little bit more about, you know,
are there any of these other boxes that you know, when you look at the
fundamental story, again, you know a lot of times we look at these numbers at
the bottom, you can see that the earnings have been growing, you know, double
digit, not huge, but, you know, double digit, 13%, 16%, 15%.
00;51;02;06 - 00;51;21;24
Unknown
And the revenue also in the double digit range, you know, 11% to 12% do not
true polls. Yes. These are things I do look at. But, you know, first thing I'll
always do is follow the price action and then I'll do the dive deeper into it.
And once you do that dive, it does check a lot of boxes.
00;51;21;26 - 00;51;41;25
Unknown
And, you know, I always like I believe is the Peter Lynch mentality by what you
know, by what you use. Well, this is something that we know and use very soon
as I age. So, you know, I'm getting the stock first and then maybe the hip
replacement or the knee later on in like to to to help fund, you know, the
stock profits can be used to help a hip replacement.
00;51;42;02 - 00;52;03;25
Unknown
Exactly. On the smart money side, one of the things that we sometimes look at,
we have an owners and funds area in the and the marketsmith and we can see that
Fidelity Contra fund will Danoff is one of the portfolio managers there that we
really like to follow has a position that is a really huge fund. So even a
0.13% position is is something of size.
00;52;03;28 - 00;52;26;13
Unknown
There you can see that. And yeah, anything else on Stryker before we move on?
No, I think we kept it simple and I like to keep it simple. I mean, I could
have given you some Fibonacci levels if you want to play a little bit. Yeah.
Let's let's go ahead and give a preview because again, you mentioned your
newsletter where you go through some stocks that are on your radar and one of
the stocks are going to be talking about in your newsletter is DocuSign.
00;52;26;13 - 00;52;47;28
Unknown
And it sounds like we haven't been talking about DocuSign for a while. This was
one of the covered darlings, you know, 20, 20, 20. You know, everyone was like,
well, gosh, you know, forget these wet signatures, let's go e-signature. And
they just really seemed to dominate everyone was afraid that Adobe was going to
eat their lunch, but they really, you know, maintained a leadership position
there.
00;52;47;28 - 00;53;06;04
Unknown
So what's what's your take on DocuSign? Something that's been out of favor. My
take is from a risk reward point of view, it looks like the set up is a little
more favorable for the bulls and you have an out you may have to rip this one
out of your portfolio immediately. If you're playing it for earnings, take your
loss and move on.
00;53;06;10 - 00;53;25;20
Unknown
But given the fact that we have a constructed base, we have a lot to reverse.
This thing was in the 200, we're 300. I mean, that's that I would never give an
upside target like that, but it is trending. The downtrend has been broken. So
I want to stop going down to its bases now. The base is making higher lows.
00;53;25;26 - 00;53;44;19
Unknown
It's holding above its 200 day moving average technical reminds me a little bit
of carvana where we saw that same exact thing happen. A lot of fundamentalists
at Carvana. But I'll tell you right now, from a technical point of view,
knowing that there were shortages in that one as well, the stock has rallied. I
don't know the shortage just off the top of my head and DocuSign.
00;53;44;24 - 00;54;05;18
Unknown
But right now the shot up is trending above its 200 day moving average. It's
flattening, starting the turn up. I think if you get positive reaction to
earnings, maybe they guide that this stock in gap you if you're not in it maybe
you want to buy that gap put your stocks close to you when you buy gas on an
opening so like two and a half, 3% below.
00;54;05;24 - 00;54;26;25
Unknown
But it can run and it could run quickly. So the setup for DocuSign, to me, risk
reward point of view is very appetizing and it may be worth a flier next week
and I'll focus on it in my newsletter. So generally going into earnings, how do
you adjust for the risk there, maybe going with a smaller position if you want
to buy before earnings or up?
00;54;26;28 - 00;54;47;11
Unknown
I had a strict rule, especially when I was a market maker on the floor. ICE was
one of the stocks I was the market maker for. I would be flat going into
earnings every single time. I do not trade stocks for earnings if I'm a long
term shareholder, I or Google. I'm not even going to care about earnings
because the earnings aren't going to change my mind unless the trend has a
major change.
00;54;47;14 - 00;55;07;06
Unknown
So if I believe it's a long term holding, then I don't worry about earnings.
I'm not trading it for earnings. If I want to take a little bit more risk on
like in a DocuSign, I'm not recommending anyone do this, but if you do, the
parameters are there and if it fails, get out. Do not make this a long term
investment.
00;55;07;10 - 00;55;28;04
Unknown
This is a trade opportunity, so I wouldn't recommend buying it. It's to
earnings. I will chase a gap. I will. I love gaps. I mean, if you want to go,
we can do a whole special on trading gaps. Those things are important to me.
But right now, seeing that something has changed, it's got my interest and it's
worth talking about, it's worth focusing on.
00;55;28;09 - 00;55;57;28
Unknown
And if someone wants to take a shot, No, the risk reward, I think the setup is
there that the risk outweighs the reward. Outweighs the risk in this case.
Yeah. And that's that's such a key point. You brought up risk management as
being rule number one, two and three. And if you can keep that small, you know,
and again, you've got a lot of room to potentially recover, you can be wrong a
lot of times if you keep that, you know, if you keep your risk small and your
reward potential large.
00;55;57;28 - 00;56;17;00
Unknown
So, I mean, that seems like an easy I'm wrong all the time, but you want to
keep things simple. This goes back to Alan Schall level two S.A.T. class I took
in 1993, for thing, and I don't know where he stole this from, but I credit
Alan, the late Alan Shore, for things happen when you get into a trade as a
trader.
00;56;17;00 - 00;56;30;06
Unknown
And I've seen them all. We've all seen them all. You have a small gain and a
small loss. These are normal things. You can have a big gain. That's the goal
and you have a big loss if you're going to survive in this industry. You got
avoid one thing, avoid the big loss. Check your ego at the door.
00;56;30;11 - 00;56;50;27
Unknown
I get this small loss. I'm getting out. Maybe I would have been right. Maybe
this could be an investment over time. But avoid the big loss and live the play
another day. That will tell every trader, day trader, swing trader, long term
trader. If you're putting too much allocation into one asset and you are going
to take the big loss, guess what?
00;56;50;29 - 00;57;08;19
Unknown
You're not going to be able to put it anywhere else. So you take that small
loss and move on to something else. There are 6000 different asset classes you
can train. They keep coming out with new ones every single day. Don't get
married to this stock. You sign because the risk reward set up was good and I
mistake.
00;57;08;26 - 00;57;30;00
Unknown
Well our cost average into it. Or know your game plan is your game plan and a
little loss is going to happen. And yes, it stinks when they do. But if you can
leave the behavioral and the ego at the door and you take that little loss, you
move on, you can yell and scream at me. If I'm the reason you got into this
trade, that's fine.
00;57;30;02 - 00;57;53;28
Unknown
Be like I'm home and you know everything. You know everything. You know, you
move on to the next idea. There are always ideas out there. That's what's great
about the stock market. Yeah, well, hey, Jay, it was such a pleasure having you
again. For those that want to kind of check out some of the stuff, go to at
Woods, the number three on X, formerly known as Twitter, you can find find him
there.
00;57;53;28 - 00;58;14;02
Unknown
Some pin tweets that'll get you to his newsletter that he does as the chief
global strategist for freedom's Freedom Capital Markets. So, Jay, once again,
pleasure having you on. I can't believe we didn't do this sooner, so we'll
definitely have you on again. It was it was a really great time. This was fun.
Joe Farm. He said it was going to be a nightmare from hell, but no goodness,
no.
00;58;14;03 - 00;58;33;07
Unknown
Don't listen. Yeah, we don't like that. Says a lot of things now, Joe. Nothing
but peace and love for Joe. He's a big fan. As am I. Yeah. Great having you,
Jay. Take care. That's going to wrap it up for us this week. Please join us.
Next week we're going to have Scott Sinclair, one of our favorites. He, of
course, is the senior as well.
00;58;33;07 - 00;58;52;07
Unknown
He's he's what ever his old job. What was your job? The head of the premium
products. So he's got some stuff to talk about because we've got our new
product market surge coming out, you know, kind of replacing markets myths. So
he's going to talk about a lot of the things that are going on there. So we
can't wait to hear all of the details from Scott Sinclair.
00;58;52;07 - 00;59;15;08
Unknown
So hope you join us for that next week. Hope you all have a great leap year,
day, leap day. And that will wrap it up for us. Thanks for watching. We'll see
you next time.
No comments:
Post a Comment