The Next Catalyst is Here | Stock Market Danger.

well folks we are coming off a historic

first quarter in the stock market with

indices straight up some of the best

rallies that we've seen in a one quarter

period since 2019 Sam bankman frauds

finally go into prison for 25 years even

with good behavior that sucker is going

away probably for the extent of half a

30-year mortgage

by so what do we have to analyze in

terms of the near-term future well

number one markets little excited it in

fact if we look at the greed and fear

index we can see we're at a 70 now on

Greed we've moved up a notch we're at

extreme greed on Market momentum stock

price strength and finally Market breath

now Market breath is not like stinky

meat breath instead it's actually a way

of saying hey how many stocks are going

up versus how many stocks are going down

and one of the things that we usually

see towards at the later period in a

cycle like what we saw last summer over

here take a look at this we saw bread uh

nicely above 1,500 in the final days of

the July

2023 stock market rally uh really the

July rally started petering out around

July 19th and it really started slipping

and sliding going into August and then

through September and October we had

about a 3 month downtrend right until

about November it was really around

November 1st that we started seeing

stocks actually rise again and this is

when we notice uh that these indices

these uh for example stock bright price

strength here for example highs and lows

you notice we're at the most negative

level at the end of that October selloff

so we went from really these levels of

extreme greed to relatively low levels

which are generally associated with

levels of extreme fear at the end of

October people thought that's it this is

the end now of course since then we've

had fantastic inflation reads that have

suggested hey maybe inflation is indeed

transitory but that's where the next big

Catalyst comes in is it truly transitory

following q1 and Q data we've had some

issues in fact one of the easiest ways

in my opinion to take a peek at this is

looking at the New York Federal Reserve

multivariate core inflation Trend

multivariate core is a big deal because

it tracks in various different decms

here exactly what's going on with the

different forms of uh inflation based on

pce now that is inspired by the CPI

which we understand a lot of people call

this the CP live but what's not good is

we're starting to see this multivariant

core Trend accelerating again let's go

ahead and disable all of the other lines

let's just look at Goods here Goods fell

into deflation actually negative pricing

in the second half of last year we saw

negative pricing begin in June continue

in July September we were negative

October negative November negative

December negative uhoh all of a sudden

in January were positive again but we're

nearly indistinguishable from Flat at

positive 02 per. but the point is Goods

inflation starting to rotate up again

notice what it was before the pandemic

it was usually plus or minus zero so

we're very much in line with before and

after or before the pandemic here for

goods what about housing

ah yeah housing we did have that

delicious lapping but unfortunately

housing is finally moving up again which

is actually what we don't want to see

we're at the highest level of housing

inflation that we've seen since May of

2023 which is about 10 months ago not

great in addition to that we have

Services X housing and the latest data

once again indicating an acceleration so

we have all three different components

of inflation that Federal Reserve

chairperson drone pow pays attention to

specifically all telling us that we're

facing an

acceleration this might explain why this

morning when we go to ec.com uh you'll

notice that I broke down something very

important here oh first thing I broke

down here at the top is that warrants

are due for the house hack if you

invested in the round ending march 2023

those warrants are due April 8th so

we're within about uh couple weeks here

of that time frame expiring uh share

certifications and our full audit will

be out by April 30th uh we are including

the share certifications in the full

audit uh that's why we're pushing it

back 30 days so we have uh the audit

complete as well which will be great

fully audited financials and shares

which is fantastic we've got obviously

our millionaire Symposium event June

21st to 23rd and the current house hack

fund raise live uh at um house hack.com

2024 and that is ending June 30th you

could read the PPM there but what's

important here under Morning News is

what Mr Waller president Waller just

told us about his opinions regarding

interest rates and I want to compare

that to What markets are doing so Mr

Waller is of the impression that wait a

second here maybe we're going a little

too fast maybe we should slow down and

evaluate the direction that inflation is

going in fact Mr Waller argues the

following progress in inflation has

slowed I see no rush to lowering the

Target rate we should delay or reduce

the number of cuts this year retail

sales and some indicators have suggested

softening demand or declining in

inflation expectations like this

morning's inflation expectation read

that came in slightly soft quote but the

evidence for a significant slowdown is

sparse and therefore the risk of waiting

a little longer is significantly lower

than the risk of cutting too soon and

inflation rebounding now if inflation

were not rebounding the way it is here

maybe this wouldn't be a big problem but

but this is at least starting to concern

some fed members now Jerome Powell says

hey you know what the first half of the

Year usually has more inflation than the

second half of the year but jpow look at

January 2023 to June of 2023 our

year-over-year numbers collapsed here

and I understand that's a year-over-year

comparison but it's not good that last

first half our inflation numbers were

collapsing now our first half is

starting with them actually rising and

now tomorrow we are going to get pce

data the stock market will be closed

tomorrow which is unfortunate because

I'd really like to cover it just like I

cover all my trade alerts uh whether

they're Longs or they're shorts or

they're short-term trades Hedges I make

it very clear exactly what I'm doing I

send all my Buy sell alerts to everybody

in the stocks and psychology of money

group you can get that link down below a

lot of people by the way bundling it

with the zero to millionaire real estate

investing course really great course for

getting started in real estate which we

know is hard right now now but people

are getting educated so uh we have pce

coming out tomorrow stock market will be

closed PC month over month is expected

to be 04 that's an acceleration from

the3 prior now keep in mind that is data

from February so we're still not getting

March data we won't actually be getting

a March data for a little bit longer in

fact if you go to ec.com you'll see it

broken down right here I wrote the next

CPI data for March comes out April 10th

that's 2 days after the house hack

warrants expire the next next fed

meeting is May 1st so you're really only

getting one report between now and then

Waller wants to see at least two reports

of better inflation Data before really

making a decision here the next CPI

report for April comes out May 15th

which is after the next fed meeting and

then the next CPI report thereafter

comes out June 12th which is actually

the same day as the next fed meeting and

just about a week before our millionaire

Symposium event so make sure to check

that out but what's important here here

is will this trend continue well almost

certainly once we get the pce data uh

for February we're going to see this

multivariate trend move up again but the

question is does the stock market care

well that's a very interesting question

because if you look at the Russell 2000

via ticker iwn you could see that we had

a 3mon sell-off that began July 31st and

we had a 3mon selloff all the way down

to our retracement level here which

ended right around November 1st so all

of Q3 was a selloff in the Russell 2000

small caps and you notice that most of

the gains in the Russell actually

occurred between June and July so most

of the gains occurred in June and July

this is interesting what were some of

the last stocks to really rally going

into June and July well let's get off of

the average candlesticks and go to the

normal candlesticks here let's go to

June and July let's see what we have

have here oh mport gets June 15th an

11.7% day here's a 6% day 3% day and we

had a couple Downs of between 1 and 2%

on other days actually you had a 7% down

right here shortly after that 11.6% so

you could see that volatility but look

at that final surge going into July

2.33%

3.2%

9%

4.6% onto July 12th and that is really

when we started then seeing that

downtrend again and sort of that

bleedout which that bleed out has really

been continuing until roughly today

today and yesterday the stock is doing

very very well in fact go back to the

average candlesticks and just look at

the last two days here we had an over 7%

day yesterday 7% premarket and another

7% on top of that now some folks are

using stocks like this whether it's open

door or matterport as essentially a

proxy for saying the last part of the

risk on rally has arrived

uh but anyway the question that folks

have now is do we Chase returns like

what you're seeing in a Restoration

Hardware you know I opened a position

and my exposure to Restoration Hardware

oh boy about uh maybe three or four

weeks ago mostly because I think

Furniture is at the bottom of the

furniture recession I think it's up from

here but it does beg the question when

you see a 17 to 18% move on Restoration

Hardware with all you really having

being an optimistic CEO in the earnings

calls numbers not actually being that

great for the the the the current

quarters earnings release and instead a

lot of optimism being painted for the

rest of the year the response of the

market is somewhat suggesting markets

are ready for what appear to be beat

down discounted opportunities with hope

because markets are looking for the next

thing to buy it doesn't seem like the

answer for markets at least in the last

few days is NVIDIA mostly because we

continue to get rejected at about that 9

74 level now don't get me wrong it's

entirely possible it might even be

entirely likely that Nvidia hits alltime

new highs after their next earning set

but that's not expected until May so

we've got about two months between then

and now to really see where do we

allocate between now and then for some

it's just dollar cost average uh into

your favorite names for others it might

actually be an opportunity to raise a

little bit of cash to be able to

allocate more

aggressively in the event we do get this

sort of pullback now something else that

we're looking at is the following uh

quote Bloomberg today despite today's

University of Michigan data tomorrow's

pce data brings asymmetric risks for a

sell-off in stocks and bonds if

tomorrow's readings on the fed's

preferred inflation gauge come in a bit

hotter than expected they're already

expected to come in warm so if we get

even more warm especially given that Mr

Waller today suggested hey you know we

might have to slow down a little bit

here who knows if he's planting the

seeds on something that he's kind of

maybe already aware of who knows the

Federal Reserve has done funky things to

manipulate our opinions in the past but

in the meantime can I personally make

the argument to bet against the US

economy no I think that's a very

difficult argument to make we are

further in inversion right now so it

does suggest that there could be some

pain coming at some point in the future

but really we've been at this level of

inversion since oh wow what a surprise

October of

2023 we had quite a steepening of the

yield curve between July 19th as well

and uh October in fact it's worth noting

that in July which might lead some

people to say this time is different in

July we were over 100 basis points

inverted and we ended in October at

about 40 basis points invert him which

means we've really done a lot of un

inverting uh in that crash that we sort

of had that 3mon selloff between uh July

August September October mostly the end

of July so it's was slightly more than

three months right so the question is

can we go substantially more

inverted for this next selloff maybe get

over to reinversion or or sort of

uninversity some of the things people

are paying attention to so if I'm an

investor right now I'm thinking to

myself do I raise cash do I trim a

little bit maybe do I keep dcing while

things are at extreme greed or do I take

a little pausy Doodles and sort of just

wait to see what happens is this a time

in the market where it makes sense to

sell everything and just sit on the

sides because we're going to have the a

worse season than 2022 no I don't think

so at all I don't think that's the right

answer at all uh but I do think that'll

be a better buying opportunity if you

are heavy in cash in the next two months

especially before those Nvidia earnings

between now and then who knows uh it's

also worth noting that Dan IES did drop

his deliveries forecast on Tesla to 425

this morning so that's putting a little

bit of pressure on the stock along with

zomi uh releasing a vehicle purposefully

undercutting the Tesla Model 3 in China

by yeah

$4,000 so uh there there are some

concerns that maybe as Dan I've said who

is a pretty much an ultra bull there are

some concerns that maybe as he says the

uh Perfect Storm of demand issues has

occurred and uh we might end up having

some of the dark days still ahead of us

you could read that full piece on

benzinga which I've linked from eack if

you wanted to see that uh on what Dan

IES thinks and he's generally an ultra

Bulls got that $300 price target for

Tesla and that is down from 350 team now

other things you're seeing in terms of

breath expanding it's worth noting that

even companies like Disney they've been

having a great rally here you're up

about

1.21% nice rally up to that 125 FIB it's

been straight up here again the sort of

expanding of uh who is getting all of

the gains it's no longer just Nvidia

Nvidia instead having a little bit of

trouble the last few days to really try

to actually keep it up uh same thing uh

true for arm though arm has been

positive most of the day today arm now

going negative it'll be neat to see if

we get a selloff into the close

yesterday we didn't yesterday we

actually had a rally into the close but

today is the last day of the quarter so

it's that last day to really show

everybody hey I got some gains and maybe

move a little to cash in case we do get

a sell off who knows though anyway uh

these are some of my thoughts hopefully

they're useful to you we will uh make

sure to get you a report on what happens

with pce tomorrow and then we'll

reanalyze but watch that multivariate

Core watch what the FED says and folks

we'll see you in the next one thanks

again make sure to go to meetkevin.com

to check out the event the courses the

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code and day Easter Sunday thanks again

goodbye why not advertise these things

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else knows about this we'll we'll try a

little advertising and see how it goes

congratulations man you have done so

much people love you people look up to

you Kevin paffrath there financial

analyst and YouTuber meet Kevin always

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always read the PPM at house.com