The Coming, Dangerous Stock Rotation (For Some)

hey everyone kevin here let's talk about

rotations in the stock market and

potentially

the next rotation right now i'm gonna

take a look at something that's been

rolling over as of the past few weeks

and something really to be paying

attention to

but first i want to give you a quick

little preface in terms of how we know

that things

go into rotation just basically by

looking at the past three

four to six months to see what has been

happening see the insane cycles okay so

here we go we know that

we've had crazy cycles since about the

election which is also approximately

when vaccines were approved

we started a massive recovery trend

recovery stocks skyrocketed we started

the year with

tech and spax and crypto at all-time

highs at the same time we had recovery

stocks at all-time high

highs everything was going great along

with this we had a big momentum movement

in gamestop

and amc right at the beginning of the

year

yeah right around my birthday actually

january 28th and in early february all

of a sudden

we started having a little bit of a

rollover we started

seeing healthcare start rolling over we

then saw a tech rollover and

all of a sudden there was a lot of short

selling happening again

almost like the shorts had to make up

all the money they were losing on

gamestop

and then the spax rolled over which were

basically a no

lose option in 2020. then the

momentum stocks started rolling over in

march and crypto peaked in april and

then we revisited lowe's in tech in late

april and

others that were selling off or had sold

off sold off even more

during this sort of cycle we had

recovery stocks

hit their peaks and kind of float and

hold out near those strong

post coved peaks but now we've had a lot

of

talk about a re-rotation we've gone

through

some craziness we've seen stocks float

up again from some of their lows over

the last few months

and we've got a new chart here from

bloomberg that's pretty empowering it

really kind of shows us

where trends were in terms of search

trends and it gives us an idea of where

things are now

and potentially where we might want to

look for the next rotation

so take a peek at this particular chart

here

this chart here shows that when the

pandemic started around

march 2020 we saw massive search results

for

home improvement computing

self-employment telecommuting furniture

exercise equipment food delivery

these are things that just went

absolutely nuts during the pandemic

we know this while at the same time we

saw vacations

restaurants movie theaters commuting job

interviews hotel

car rentals apartments and flying all

plummet

and now these things started doing

better in the summer

then we started getting some concerns

about like maybe a second wave and the

winter came and so we had these

search results plummet again and then we

had our second stimulus and our third

stimulus

which really led to this explosion again

in

uh in restaurant searches vacations

movie theaters commuting

all that right but take a look what's

recently been happening

we've actually seen a decline in almost

everything like it's literally the

everything decline

right after the stimulus money came in

stimulus money came in

we even had more searches for things

like furniture

exercise equipment telecommuting home

improvements we still we had more

searches for that right

but look at it literally everything

plummeting

and this is as of june june going into i

think they're

reporting out july that july obviously

hasn't happened yet would be somewhere

around here

so this would really be a transition

from the beginning of may

to june which is where we are now uh and

i really like this

sort of visual representation they did

here because really what they're doing

is they're taking google search trends

and they're interlacing them

along with probably some other software

to help uh you know collate these these

search trends

but i have to say this is really really

interesting because

it's sending us a few signals the first

signal that it

sends us is and i know i know some

people they don't like hearing this

because you know we hear the fed and

we're like ah those are just the money

printers they're gonna ruin our money

and all this right

get that but one of the things the fed

said is

when the economy begins to reopen we

could literally see a

big old fat surge of spending and a

surge

of inflation because of that but that'll

be temporary and that'll subside

just like supply chain issues and base

effects will subside

folks if you look at the search trends

right now

look at this stimulus stimulus boom

and now subsiding so far and we want to

keep

an eye on this and this is something we

talk about on the channel is you want to

keep an eye on inflection points

i like to be the first channel on

youtube to tell you about inflection

points

whether it's good news or bad news i

will report it to you

this is why hopefully you subscribe to

these videos or you join me in

in the uh live streams private live

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link down below 40 off we talk about a

lot of trends before before they happen

because it's almost where we get to

brainstorm and talk about ideas and ask

questions directly to each other

and now i corroborated a lot of this

with google search trends and i also

went on to

website comparisons and i noticed that

so far at least

i still have solid website activity for

websites like travelocity southwest.com

delta.com

i'm still seeing straight up into the

right growth at these companies

so i'm not sure if like the leading

search trends

are slowing down and then we're going to

see website traffic decline

that could be the case i do know that

when i looked up peloton which is

obviously a company that i invest in

i did notice that we didn't get a spike

in january like you would have expected

followed by a fall

we actually had a rise in peloton's

website analytics

all the way through march and it was

only after march

that we started seeing a slowdown in the

website analytics

for peloton which is really incredible

and keep in mind the number getting

smaller is actually a better thing when

you're talking page rank

but anyway you really got to slow down

here in the second quarter

whereas first quarter was still a big

big growth level here

but really you're not falling which is

incredible you're

holding at these higher levels here so

it's definitely a little bit

interesting to see these differences

because it's possible

and and this is where it's a little up

in the air it's possible

that search trends could come before

a decline in actual website activity for

example you book a ticket because you're

searching for flights

that activity might slow down two to

four weeks before

actual like website data slows down

because people who've already bought

tickets are still going to that website

or checking their tickets or making

revisions or getting their stuff

who knows right but this slow down

is very very clear this slow down is

uh no good so to speak but

while it's no good for recovery in terms

of

travel and spending and this surge of

spending what is it potentially good for

well inflation it actually reiterates

the belief that wait a minute

if all of a sudden we have the surge of

inflationary style consumer spending

but now people are kind of going back to

all right i did my spending i've been

back out i went on a vacation

wow disney was way crowded more crowded

than i thought oh wow the restaurants

were crowded more crowded than i thought

you know now all of a sudden people are

done spending again either because the

stimulus is worn off or it's like okay

fine we're back to normal this is

something to keep an eye off

because this potentially reiterates what

the federal reserve says

that maybe inflation is actually not

here to stay maybe it

is actually temporary which is crazy

but bottom line here folks watch

the search trends right now the search

trends in terms of which stocks to

potentially invest in

right now the search trends not so hot

for

hotels car rentals apartments flying

they're rotating down from the peak that

we had

about six weeks ago the same is actually

true for

food delivery exercise equipment those

search trends are

softening all spending across the board

is softening

that doesn't necessarily mean that's bad

you know sell certain sectors or

whatever

i personally think and you already know

this i personally think recovery is

probably a little price to perfection

uh and that tech has already had a very

nice sell-off

but it's definitely an indication that

maybe inflation won't come in as hot

as expected something to keep an eye on

thank you so much for watching if you

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in the next one bye

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