Decoding The Trump Economic Paradox

market activities today and folks I got a good one for you tonight let's begin with the tape a little bit cuz uh these

The Tape: When Pull Back?

number one question is what happened M we going to get a pullback or are we just going to go crazy with this Market

in a straight line and never get a pullback what happened it is important to understand the mechanical aspect of

the tape so we opened gapping down and you saw that the momentum was shifting we were about to go down as anticipated

because the market maker wanted to neutralize some of the calls but then came the Trump conference and it caused

a pump in other sectors besides AI let's say the Industrials the Trump kind of

names based and the announcements and the policies that he was floating out in the conference and that caused the

market maker to be squeezed at the end of the day to the upside because Apple was weak today Nidia was weak today the

vix was going higher so everything was playing out according to plan but then came the Improvement of the bread in the

aftermath of the conference of trump and I think that's what caused the squeeze that you saw at the end of the day so we

said in Discord that today's ideal close for the market maker would be below 607

and will explain why in a minute but if we keep trading above 607 then the market maker will have to close just

below 610 and you see here the one minute chart in the Spy huge pump at the end of the day that got us just a touch

below 610 and we've been trading above 607 since let's say half of the day the

first half wouldve been trading below then second half will be trading above so the market maker came up with the conclusion at the end of the day that

it's better to squeeze higher to hedge because there is risk that in the aftermarket session let's say if they

closed at 607 and A2 then all of a sudden what if the market goes higher

post market and we head to 608 or 609 because we have earnings coming out of the the postmarket session so the market

maker put two and two together and decided to squeeze all the way uh to hedge against all of these calls but

stop short with the next highest number in open interest which is 610 I'll show you in a minute but bear in mind don't

be surprised that we could wake up tomorrow with a G down or tape the trades down throughout the session

because we're now talking about options expirations and gamas and all of that I'll give you an example here not so far

by the way we go back to December this is the one minute chart so you can see in the session that I'm highlighting

huge pump at the end of the day then a gap down and trading to the downside during the next session let's go back to

the uh end of December again you see another pump before the end of the session and then we see a gap down after

that so don't be surprised to see that and I'll show you the reasons here if we look at the calls and puts for today's

expiration so that's already done kaput it's it's over this is all expired right now what was the highest number of open

interest upon the open meaning the highest risk we call that the wall the wall was 610 because it had over 22,000

contracts open but what is the immediate risk that the market maker needs to neutralize the answer is the highest

number of change in oi nearest to the price little bit complicated but in a

nutshell you look at the oi change 10,000 contracts the 607 so that was the

nearest number with highest open interest that changed overnight so that was the point where the market maker

wants to go to 607 and then stop below and that was the maximum pain of the day because if you look at the puts it's the

same thing a lot of puts opened overnight but the nearest highest number of both open interest and change of open

interest was around 607 so was The Sweet Spot to close in to exercise maximum

pain on both the put s the calls and at some point throughout the day by the way the calls were the majority of them were

losing a lot of money even the ones that were already in the money and so did the puts so at some point they did achieve

the maximum pain that they wanted but then there was the risk of wait a minute here I mean we see the 608 calls for

example 13,000 contracts open overnight we still have 177,000 contracts open

some of them of course changed throughout the session maybe the numberers less or a little higher who knows but there was a lot of risk and

this is why they had to push it all the way to new neutralized 608 609 and then stop short of 610 which has the highest

number of OI in the calls and the highest oi change overnight what could

happen in tomorrow's session too early to say but if we look at the puts uh who knows how the oi change is going to be

because this is the expiration data tomorrow but if I'm reading the tape correctly here 605 could be the sweet

spot because what's going to happen today is a lot of puts closed so you see the uh 11,000 12,000 almost the open

interest in 605 probably that was reduced overnight in a big way but then you look at the uh calls that were

bought through the session today add of the money with the expiration data tomorrow you're probably going to see a huge increase so probably the market

maker wants to move the tape down to exercise maximum pain now on the call side were bought today so again too

early to say We'll assess that in the morning tomorrow but you got to understand that today was a lot of

mechanics because even if you look at here we're pinning the SPX and Y the S&P

then you got the TLT in Orange and you can see that we have correlation bonds and stocks are moving together why do we

see the lack of correlation here where the TLT goes down the SPX goes higher a lot of mechanical aspects going on and

the AI pump that we got uh two days ago uh but sooner than later if we just roll back you can see that we see divergences

when the market goes higher but TLT goes down but sooner than later they catch up with one another and in the last two

examples the market did catch up with the bond market so you saw a little bit of a pump but then the market gave up

and caught up with the movement in the the bond market likewise if we look at the RSP the equal weight S&P 500 in

white and then we look at the TLT once again in Orange you can see that there is correlation but why do we see a break

in the correlation recently I think we have a lot of mechanics going on a lot of trump optimism a lot of diverences uh

but they're going to catch up with one another either the bond market is lying and it's going to move higher tomorrow or usually the bond market doesn't lie

and we see equities catching up with the bond market so keep that in mind but let's go to the main event of the day

which kind of changed the mechanical risk that's the Trump conference that we got today of course the cult's meeting

The Trump Economic Paradox

at Davos he was not there but he addressed the the cult via teleconference and he said the important

things uh the media took the headlines oh Trump said he's going to do this he's going to do that what I'm going to do is

something different I'm going to stitch the entirety of the economic Paradox because it was an amazing conference by

Trump because not amazing because the policies are great or anything but amazing in terms of outlaying his

economic policy with extreme Clarity there is no doubt what this man wants to

do economically I think it's going to be a disaster at the end of the day but there is a method behind the madness so

let's decode it one by one what is the problem in the economy here's president Trump identifying it take a look because

of these ruinous policies total government spending this year is $1.5 trillion higher than was projected to

occur when I left office just four years ago likewise the cost of services the

debt is more than 230% higher than was projected in 2020

the inflation rate we are inheriting remains 50% higher than the historic Target it was the highest inflation

probably in the history of our country okay so the problem is we have high inflation we have uh budget deficit and

we have high interest payment on the debt meaning that we need to do one of two things either reduce spending which

he didn't really talk about I mean there was Doge and there was some initiatives but what is that going to cut 100 billion 200 billion that's not a drop in

the bucket that's nothing so the the other approach would be okay maybe he's going to increase the revenue side he

can only increase the revenue Side by increasing taxes but here's what Donald Trump proposed take a look are going to

pass the largest tax cut in American history including massive tax cuts for workers and family and big tax cuts for

domestic producers and manufacturers and we're working with the Democrats on

getting an extension of the original Trump tax cuts as you probably know by

just reading any paper so he says we have high inflation we have high budget deficit and we have a high debt payment

is now over a trillion dollars but he wants to cut taxes too that's going to reduce the revenue that the government

receives that doesn't sound like any logical Economic Policy unless you're going to reduce the spending by a lot

you're going to do austerity measures you're going to reduce a trillion dollars a trillion a half half in spending that's going to cause economic

recession where are you going to cut defense Social Security Medicare none of that going to happen doge is probably

going to cut maybe 100 200 billion if they're lucky but that's about it the tax cuts will probably add a trillion $2

trillion doll to the deficit and the national debt so you need to increase the revenue you need to compensate for

the loss in Revenue by the tax cuts with another source of Revenue well the

president proposed that this is the way we're going to substitute the loss and revenue from tax cuts with you guessed

it tariffs take a look but if you don't make your product In America which is your prerogative then very simply you

will have to pay a tariff differing amounts but a tariff which will direct

hundreds of billions of dollars and even trillions of dollars into our treasury to strengthen our economy and pay down

debt now look you can go back to the uh first term of the Trump Administration

all of the tariffs produced barely a drop in the bucket maybe $150 $200 billion but that's it is that really

going to compensate for a trillion $2 trillion doll worth of tax cuts and reduction Revenue I don't think so so

you might stop right here and say you know what Trump doesn't know what he's talking about his Economic Policy doesn't add up but the president has

another trick up his sleeve which is the reduction of interest rates how are we

going to do that take a look with oil prices going down I'll demand that interest rates drop immediately Med and

likewise they should be dropping all over the world interest rates should follow us so he says we're going to

demand that interest rates drop immediately in other words he's saying I'm going to go to war with Jerome pal

at the Federal Reserve that's going to cause a lot of chaos but the most important thing that he said he might go to war with pal and fire pal it gets

really dramatic and ugly but he said something before which is we're going to drop the price of oil if the price of

oil goes down then there is no inflation risk and if there is no inflation risk then what's the harm in dropping

interest rates further of course we we explained before that if you cut interest rates oil would go higher by

default but he thinks here that he can keep oil prices down keep inflation down

and there is no need to go in a war with the Federal Reserve because with this Dynamic the FED will just continue to

cut rates how is he going to drop the price of oil though take a look and it's also reported today in the papers that

uh Saudi Arabia will be investing at least 600 billion dollar in America but I'll be asking the Crown Prince who's a

fantastic guy to round it out to around one trillion I think they'll do that because we've been very good to them and

I'm also going to ask Saudi Arabia and OPEC to bring down the cost of oil you got to bring it down which frankly I'm

surprised they didn't do before the election that didn't show a lot of love by them not doing it I was a little

surprised by that if the price came down the Russia Ukraine war would end immediately right now the price is high

enough that that war will continue you got to bring down the oil price you got to end that war they should have done it

long ago they're very responsible actually to a certain extent for what's taking place millions of lives are being

lost so in essence the economic policy is we're going to bark at Saudi Arabia and threaten them if they don't increase

the production to drop oil prices down what are you going to do what is the incentive for Saudi to increase the

production right now and destroy their economy by reducing the price of oil because Saudi has a a a budget deficit

of $27 billion they need to increase the revenues to fulfill the diversification

dream and projects out of oil by 2030 if they increase the production that goes

contrary and hurts Saudi Arabia are they going to really hurt themselves I don't think so unless there is a reward the

carrot that the Trump Administration will offer to Saudi Arabia what would that be say Saudi Arabia adds another 50

or 100 billion do to the deficit just to please the Trump Administration what are they going to get out of it the answer

is there's nothing we can really offer at this point nuclear program maybe maybe but the likelihood is and you saw

the last statement when he blamed Saudi for the war in in Ukraine that was a huge huge statement that was big talk

and there's a lot of nervousness right now in Saudi Arabia overnight because of that in other words Trump is not going

to offer any reward when he said oh I'm I'm frankly I'm surprised they didn't drop it once I got elected he's going to

offer a punishment the stick to Saudi Arabia if they don't drop the price of oil by increasing the production higher

gee what would the stick be in this case uh supporting the houthis in Yemen who've been bombing ships and causing

trade chaos in the Red Sea that's stupidity that's not going to happen what else you going to do support Iran

that that goes counter to any logic really so my question is what is the incentive for Saudi to do anything here

when they have $27 billion in budget deficit and here's the other headline Saudi Arabia es growth forecast sees

wider budget deficits we already talked about that but here's the reality for you Saudi real GDP is expected to grow

8/10 of a percent this year in a dramatic drop from a previous estimate of 4.4% according to the Ministry of

Finance Saudi authorities also expect that the budget will remain in deficit for the next several years as the

kingdom prioritizes spending to achieve the targets of the vision 2030 economic diversification program Saudi Arabia's

fiscal Break Even oil price listen to this really important has increased and

may continue to rise as oil prices are expected to stay subdued I don't think they're going to stay subdued if we

continue to cut rates so let's backpedal just to uncode the path for the Trump

Economic Policy he's going to add pressure on Saudi Saud is going to increase the production oil prices go

down with that the inflation risk goes down and with the inflation risk going down we're going to be able to drop

interest rates and reduce the debt payment which will allow for tax cuts

and then on top of that you had tariffs and now you're reducing the whole in Revenue done by the tax cuts with this

Dynamic you achieve a higher stock market you achieve an economy that is still going and you achieve less

inflation you achieve uh less debt payment so you can add more to the debt and grow a little more that's the

Paradox there's a method behind the madness but it all relies on what is the incentive for Saudi we've seen in the

past when Saudi Arabia increase the production we've seen oil prices going down for a little bit but at the end of day if there's an inflationary dynamic

in the economy and the US bond market expects higher rates because of the inflation threat oil bounces back so

again I think this is this is an economic policy that depends on a lot of geopolitics and a lot of threats and

using the leverage the president right now everybody's kissing his ass he sa said yeah we'll do whatever he said we

they're going to do $600 billion I'm going to ask for a trillion they got a budget deficit they can't spend $600

trillion do or whatever you you're floating there it's the same fugazi number that he did with soft Bank never

going to happen all these things not going to happen but of course it's all talk right now to fluff up and manipulate the market and the economy

and just give everybody the optimism that he's doing something but the point being the Saudis did not really issue a

statement against it oh we're not going to cut the we're not going to increase the production or we're not going to spend a trillion they just said friendly

statements right now and you see the tech oligarchy for example kissing Trump's ass everybody's right now kissing Trump's ass why cuz he got the

super majority he can do whatever whatever the [ __ ] he wants right now got the Congress got the Senate got the Supreme Court and that's why they're

afraid but that's going to change once we head to November and we get midterm elections and things could change in

Congress all of a sudden the president loses his power so that's important for us to understand that the Trump economic

Paradox could work in a short period of time but then it's going to backfire

what else in the Trump economic policy that is worth mentioning there are two things number one of course the AI

investment so now he says I'm going to do the tax C that's going to reduce the revenue but watch out will increase the

tariffs that's going to make up for some at least some of the Lost revenue from the tax cuts and oh by the way we going

to have foreign governments and foreign companies investing uh billions trillions just throw numbers out in AI

projects take a look soft bank has announced between a

100 and $200 billion investment in the US economy because of the election result and just two days ago Oracle soft

bank and open AI announced a five 00 billion investment in AI

infrastructure uh other companies likewise have announced billions and billions and billions adding up the

trillions of investment in America in the United

States now we talked about this yesterday that the Stargate AI fugazi project will never happen and Elon Musk

accurately pointed to that fact of course he has a beef with Sam Alman that's why he's butt hurt right now but

he pointed out correctly that there is none of these companies have the cash to fulfill the promise of the Stargate

project so here's forb saying inside the Stargate AI reality Distortion field and

they point out to the problem with all of this AI promise that companies

overinvestment questioning are we really going to see benefits from AI what are we trying to do here because it seems to

be like a formal kind of spending with the companies are competing with each other because we have shortages in the chips in Nidia and whose company going

to do what in AI but you saw the problem with uh for example Google AI today dropping Biden as president allog

together so we have a problem with the gener of AI and listen to what they say here this comes at a time when our

research shows that enterprises are in the early days of figuring out what to do with it meaning AI consulting firm

McKenzie recently estimated that 65% of surveyed firms were using generative AI

in gaining business value out of it although the exact Returns on investment remains unquantified if you catalog the

many remaining questions about Stargate as well as the fuzzy nature of the AI

Market this might be the most speculative business announcement in White House history and here in this

paragraph right here in a nutshell they say if there's a huge AI announcement a project by the White House of 500

billion to a trillion shouldn't Jensen hang the the top name in AI the most important man in AI right now shouldn't

he be present otherwise what is the legitimacy of the project or is this sort of a a Trump making some

billionaires jealous of other billionaires to see who's going to kiss his ass the most and who's going to contribute to his campaign and his

finances the most keep that in mind why pin Elon Musk against Sam Alman I think

the man knows what he's doing he knows that Elon is in his pocket he's been kissing his ass throughout the whole thing already scored $200 million from

Elon Musk uh so now Elon Musk is the clingy boyfriend and he says you know what you stay in the I'm gonna ghost you

right now Elon go [ __ ] yourself I'm gonna find another hotter boyfriend here in Sam Alman to make you a bit jealous

or I'm gonna have Larry Allison not Microsoft or I'm gonna have uh soft Bank not Nidia that could be the game here

anyhow continuing with the article here the Wall Street Journal in the meantime points out that the soft bank that soft

bank has about $30 billion in capital that means they'd have to raise additional $470 billion for the project Stargate

where is that going to come from Saudi Arabia right it's just Saudis all of a sudden have more money than the Federal

Reserve it's absolutely absurd anyways let's put this in more context Microsoft

one of the largest companies in the world with 3.3 trillion in market

capitalization has only allocated $80 billion to AI infrastructure investment

this year so roft bank will come up with uh $500 billion where is that money

coming from it's phony it will never happen anyhow the only part of the web of intrigue Oracle also featured in

Stargate and at the press conference is a fierce rival with Microsoft which was

left out of the media party at the White House really important though Microsoft is named along with Nvidia Oracle and

arm as technology partners for Stargate that Microsoft has a significant financial interest in open AI or it has

invested tens of billions of dollars hey it is a gigantic Game of multi-billionaire Poker who's going to

win question mark I agree this is all [ __ ] this is all a game to make the billionaires pinned against each other

who going to promise more who's going to kiss ass more continuing but what is the business model behind Stargate question

mark will it compete with the core weave for GPU as a service or would it compete with anthropic and Google and meta on

training or iws for services question mark it is unknown they did not say oracles Larry Ellison who's by his young

appearance at the age of 80 my favorite billionaire by the way at 80 dating chicks or like quarter your age right

that's the way to do it but anyways might do well as a spokesman for the Fountain of youth his strategy by the

way if you bang a younger chick that makes you younger anyways they believe in that kind of thing anyhow he did make

some eloquent statements about training for drug Discovery for of all things because he wants to be right forever

young but it's not why do we need drugs right just bang younger chicks you'll stay young forever anyways but it's not

clear if that's just an example of one potential application it's for gazi it

will never happen and I doubt that Saudi is going to somehow increase the production of oil uh and drop the prices

and hurt them themselves I think that's going to be tougher what else do we have in the Trump policies how about increasing spending by NATO take a look

I'm also going to ask all NATO Nations to increase defense spending to 5% of

GDP which is what it should have been years ago it was only at 2% and most

Nations didn't pay until I came along I insisted that they pay and they did because the United States was really

paying the difference at that time and it's was unfair to the United States but many many things have been unfair for

many years now this one going to be pretty good for defense contractors so you saw RTX Ron huge pop in the last uh

couple of weeks and I think we have more to come so you want to add exposure to the defense sector folks we've been

saying this for for years now uh another name is hwm I mean this this stack is on

fire we covered some unusual activities a few weeks ago and look at the pop that we got since then that name remains on

fire other name is KT gratus it was added to the Maverick portfolio last

year and it was one of the top performers uh still going don't stop inside now you can invest in an ETF if

you don't want to place all of your eggs in one basket that could be a choice of the ITA for example that's a defense

Aerospace and defense ETF another Choice could be the xar also tracks the same

names but I do favor the xar over ITA I'll show you why if you look at the components of the ITA about 18% in GE GE

been going higher but who knows how long it will stay high and then RTX about 15% so uh you're putting a lot of eggs in in

two baskets here of G and RTX and this is why I don't like this ETF I like the

other one X AR because sure it has speculative names like rocket lamp for example uh but it's only 8% we have

other distributions in Boeing in rathon and lcky a lot of Aerospace and defense

play so I do like the X a little better than the ITA but both of them will do the point being here and some exposure

to defense now before we move on to the market information folks let's revisit the morning brief because it was an

Market Commentary: AAPL vs. NVDA Dynamic

awful one I got it wrong today it happens once in a while folks uh in a nutshell but there's something that I

got right which will be uh relevant for tomorrow and for next week so we talked about how the key to the market today

would be apple versus Nidia we've noticed recently that if Apple goes down Nidia goes up if Nidia goes down Apple

goes up so recently Apple became oversold the video became overbought in the shortterm charts so the suggest was

looking at the pre-market charts that we could see in this session Apple going higher Nidia going down and that keeps

the indices a little bit of float but maybe a little bit of weakness depending on how the vix reacts I showed you this chart in the morning Apple hourly chart

suggesting that if we break above 225 we could go all the way to the Gap fill and that will give us a trade and of course

that's going to come at the expense of Nvidia but here's the update we got a Touch Above 225 then flush down again in

apple does that mean that apple is going to go down tomorrow or next week be careful cuz I'm going to show you the chart in the charts analysis there's

something that you have uh to understand before you do these decisions Nidia this is the chart that I showed you in the

morning that the important number is 145 if we stay below then Nvidia goes down Apple goes higher here's the update it

didn't last for too long Nvidia made it above 145 and actually had performed Apple today but the point being folks

here's Apple in white Nvidia in green 5 minutes chart you can see that there is

a bit of inverse correlation from the arrows that I'm drawing in the chart right here that when Nidia goes higher

Apple goes down and vice versa so today's session Nvidia goes higher Apple goes down the point being is at some

point apple is going to get really overs sought but apple is not going to be able to Rally or move higher without Nidia

Giving Up So This is a dynamic that could be really juicy for a trade uh if you can spot it and time it correctly

which obviously I did not do today anyhow let's add more color to this conversation by revisiting the market

activities today beginning with the closing of the ndc's and uh here we go

Market Performance: Defying Bonds

the diamonds that's with the Improvement of breadth after the Trump conference you can see that we opened lower on the

Dow but immediately after the conference had caught a bid so the down was up by 4834 points or a gain of 0.92% the ndaq

again was the end performer right for the majority of the day until the end of the day when we seen a pump because of

the mechanics around the Spy so the NASDAQ managed to close positive 4434

points or a gain of 0.22% the S&P also between the down in the nasx so is positive 32.3 4 points or a gain of

0.53% the Russell 2000 performed today even though the TLT was down bond yields

were higher so I don't know if that performance is going to continue to last it managed to close positive at 1.04

points or a gain of 0.46% looking at these sectors all in all Healthcare making a big comeback today number one

Industrials remain hot based on the Trump trade uh some sectors acting as if yields went down by the way such as

utilities real estate bouncing higher we'll see if yields continue to move higher in tomorrow's session then

they're not going to hold and Technology of course the lager being a touch positive in the aftermath of the Trump

conference we've seen the breadth improving so the NYC closed with 62% advancing 36% declining the NASDAQ 56%

advancing 41% advancing you can see it in the heat map here folks the rest of the market financials healthc care

Heat Map Analysis: Breadth Comeback?

Industrials some of the utilities the medals the defensives the cyclicals uh were at performing today but the stuff

that at performed yesterday the Amazon the Googles the big caps were underperformers and some of the chip

components from the Stargate project that caught a bid like arm is down about 7% today Micron down about 4% the

manufacturers like asml Amad all of them pulling back uh so it's interesting Dynamic that you keep the index afloat

by keeping one of these two components at performing by a lot yesterday was the big cap names and the AI names rest of

the market was down now they switch it to oh rest of the market pumps higher Ai and the big caps take a break that's the

rotational aspect of the market and so long as it continues it keeps the indices a float which you need to see

the indices going down in a reliable way you need to see an increasing in what in the vix in hedging an increase in the

vix will cause a selloff across the board in the map we have earnings coming out soon you only need one bad earnings

to send the alarm through the investors community that hey it's time to hedge keep that in mind looking at the heat

map for the ETF Ste te down so Yi went higher yd iwm xlu iyr uh xbi biotech

trading higher all the yield sensitive names trading higher xrt with the exception of the K Regional Banks little

bit of Divergence here we'll see if it's going to last or not the dollar was up a little bit but we see an impact crypto

down GDX gold minor down silver down about 1% so at least there's correlation

with the dollar going on uh if we look at the breadth today see the NASDAQ being outperformed by what the RSP uh

dividend paying stocks you can see that value iwd vtv at performing large cap

growth but both of them perform together we're positive today so it's it's really hard to knock the index down if you have

both of them working out together uh the index goes down better if we see major underperformance by growth because

that's where the concentration of waiting is or weakness in both of them growth and value but if you see weakness

in value but growth stays High the indices keep going higher it makes it tougher right it makes it tougher for

the market to pull back back with this Dynamic so again you need to see sort of a scare can it happen from the Japanese

end can it happen from a policy risk can it happen from something to increase the hedging and then we see a selloff that

is inclusive looking at Futures and commodities what do we see here uh crude oil tried to move higher today but then

Commodities: Trump Can't Print More Meat

came the conference and the threats by Trump that he's going to do this and that and saud's going to do this and that why did the market took his W

because it doesn't make sense the Saudis will never do it but the market took it seriously today at least the Traders der risked and sold oil a little bit maybe

shorted a little bit the reason is because Trump has the Super majority and when you put two and two together he

could do damage to Saudi if he wants to and maybe the Saudis will capitulate at least all the way till November and

that's why we see a move down in crude oil but if we see a bounce tomorrow in crude let's say moving by 1% 1 and a

half 2% then the market forgot about it digested it and said you know what uh we don't think that's going to happen why

would the Saudis hurt themselves in dumping uh more oil in the market now softs remain hot so if the president is

just concerned about energy prices as a reflection of inflation watch out because other Commodities are moving

higher so O's up about 2% coffee 1% sugar about 3% of course oil is more important than these Commodities but

needless to say I mean even grains are now moving higher like soybean oil corn soon enough wheat you see meats and

alltime highs live cattle feter cattle and uh today we see that padium

beginning to find the footing copper uh not at the risk Zone yet where we can cause inflation for Metals but the

inflation is I think the risk right now energy and grain don't forget about Meats too those three what are you going

to do increase the production in beef uh increase the production in corn or wheat that's not as easy as hey let's just

pump more oil so I think that's going to be harder to tame in terms of

Options: Short Nancy?

inflation moving on to the big Casino options what do we do here volume is still subdued I don't know why the

volume but again I'm going to keep saying this folks that the ratio between the calls and the puts is alarming it

doesn't look good here uh we see a little bit of increasing in put Demand on palente tier so Jim Kramer came out

today and said nothing is going to stop paler so the Traders bought puts and paler today as a protection method or

maybe betting against paler so that's the only significant change that I see in the put to co ratio but it's still

excessive and folks the market maker has to do something here they tried to do it today but they got squeezed they might

try to do it tomorrow by a gap down or an aggressive flush just to make sure that the positioning is more neutral

because this is way way over concentrated from one side versus the other it in changes in the IV rank not

really again the most attractive trade that I can find really is Nidia you want to trade it up you want to trade it down

it's the cheapest among uh all of these uh stocks that you see another attractive one is msdr micro strategy

the options been absolutely absurd in the previous weeks but now we have the IV rank down to 20 so relatively

speaking micro strategy is cheaper if you think Bitcoin is going higher maybe you want to buy some msdr calls if you

think it's going to go down maybe you want to shop for some puts let's do the unusual activities beginning with a YOLO

trade this is not going to be relevant to you because it's already already happened and it's going to expire tomorrow but it is telling about how the

options Market work out somebody bought the Thousand calls for the expiration date of tomorrow on Netflix spending

about a little over $200,000 now when you see a squeeze after earnings because

of a huge fundamental Catalyst such as we've seen in Netflix you see a lot of calls accumulated you see a lot of short

covering you see a lot of gamma happening in the in the aftermath of the earnings but what happens is the Market

maker usually squeezes the name higher comes options expiration because we have a lot of risk in positioning that some

calls could be in the money by expiration so we see a a little push Higher by the end of the week this is what the trader is betting on by buying

the Thousand calls for tomorrow then we got the K Regional Banks here they did the bull call spread they bought the 66

calls they sold the 73 calls the expiration date March 21st 20125 spending about one and a quarter of a

million dollars the earnings continue to roll I don't think that the banks here Regional banks will perform if fond

yields continue to go higher because at some point they're going to face the systemic risk issue habat Al Kaa was down initially today because of earnings

but somebody here sees it going higher trade Wars tariffs so aluminum becomes a hotter play they bought the 40 calls

sold the 45 for the expiration date of April 17 2025 spending about $1 million

then we have another one here marll I like the name I think that could have a bit of potential here they bought the

140 calls for May 16th 2025 spending about three and a quar of a million

dollar the chart looks pretty good but I don't know if you can perform if Nidia goes down that's the only caveat how

about the TLT let's go back to the conversation from the beginning of the video we said who's lying here usually

the bond market does in line if it's down then the Divergence where the S SPX goes higher or RSP goes higher is going

to be resolved in favor of the TLT with the TLT continues to go down and it pulls the market down but here we have

somebody who disagrees says no that the bond market is not getting the memo and

with the threats of trump lowering the rates and reducing the price of oil maybe the market the bond market will

change its mind and begin to drop rates and move bond prices higher in that case

it'll be good for the TLT so somebody bought the 89 calls the expiration date of May 16 2025 spending about $2 million

this one is a really interesting one it's a neutral trade it's a strangle for Huma so somebody bought the 260 puts and

they also bought the 330 C for the expiration date of September 19 2025 spending about a little over $4.5

million how would this trade work app you're looking at human weekly chart hm so they bought the 330 calls they bought

the 260 calls you can see the expiration date uh around September they think by that time we're going to be way above

330 or way below 260 and here's by how much for the trade to be profitable will'll be at least at in the bullish

side above 375 by then by September or below 215 for the trade to be profitable

could it it happen yes there's a possibility and bear in mind the trader can close the trade at any time they

choose so if there's a pump in human for example above 330 now the strangle is paying money they can just close the

trade at that point they don't need to go above 375 that's just going to be based on the expiration date if they

decide to hold so is it a rational trade I think so I think there's a big move coming at human they just don't know if

it's going to be up or down let's do the bearish trades beginning with ceg here it is again Constellation Energy I'm

going to do it tomorrow going to buy some puts here and ceg cuz it went way too high I think we had to pulled back

uh the trader here bought the 340 puts they sold the 320 the expiration date of March 21st 2025 spending about two and a

quar of a million dollars and then we have GLD so betting the dollar would go higher gldd bear put spread somebody

bought the 253 puts they sold the 244 puts the expiration date is February 21st 2025 spending about $2.5 million

maybe a bit on uh the Yen maybe going down boj not going to do anything they don't want to upset Trump perhaps so Yen

goes down dollar goes higher gold goes down just speculation for now then we have EMP nfas a lot of you love to trade

this name here somebody thinks that it's going to go down significantly so they bought the 60 puts the expiration date

is March 21st 2025 spending about $4.5 million then we have another one here betting against Nancy I don't know if

that's wise but anyways VST somebody bought the 180 and the 195 puts the expiration date February 21st 2025

spending about a little over $10.5 million let's do the charts and wrap it up beginning with the most important

Charts: This Could Breakout Big

indicator that is the vix the vix didn't change by the way went higher today hey the vix is breaking out of a a falling

wedge pattern so it's kind of contradictory to what happened today in the tape just keep that in mind that because that could be kind of a early

warning sign that today's pump was a f gazi looking at the S&P an hourly chart what do we do here it keeps going I'm

looking at the Mt looking at the RSI have we seen anything like this before we see the momentum indicators way way

hot and then we see the tape going higher yes we've seen it in the past problem is it doesn't last too long

you're going to get some sort of consolidation of a pullback uh that's just inevitable looking at the daily chart the RSI here is not overbought

with challenging the trend that we lost to capture the trend so that's the next important Milestone can we close above

the trend or close below tomorrow uh I would uh get you back if we roll the

chart back to the summer of 24 we got a similar pump when the market bottomed in August let's zoom in in that episode in

the hourly and see how the chart looked like so you see the huge pump that we got since the bottom in August then you

see the uh macd indicator shifting from bullish to bearish in a similar pattern to what we got today resulting in

consolidation for a little bit but then it went down so since the Crossing in the hourly macd the chart went Higher by

about 1.7% but then it went down from that particular point the initiation point of the reversal from bullish to

bearish by about two and 3/4 of a percent so it could be the same case here where it becomes a little bit

frustrating that hey the momentum is way too hot but the chart refuses to go down but in time it has to pull back it has

to reduce that momentum uh in attract new buyers The Q's same thing but the q's is underperforming today because the

majority of the Rat happened from the Improvement of the bread but it faces the same dynamics that we see in the

chart of the Spy looking at the daily chart uh again the Battle Is Right now recapturing the trend line we've seen a

false close before and we lost it is this another false close and we lose it again perhaps but even if we do folks

and we go down it could be another attempt here to attract more buyers in a formation of an inverse Head and

Shoulder and then higher we go so you got to keep that perspective in mind if you're betting that we lose the trend uh

don't go crazy like 500 puts 480 puts that's not going to happen right now you got to be rational that we maybe revisit

the inverse and and shoulder line and then see what happens from that point on because it could be if we break the

shoulder line then we go down we're probably going to go down all the way to the lower Bullinger Brands if we plug that in but let's not go ahead of

ourselves here looking at Apple you got to be careful because yes Apple did not close above 225 but it might tomorrow

and it might next week before the earnings report come out as the shorts begin to cover right now before you

short Apple even when to squeeze a little bit of gains before the report comes out make sure that the threat of a

cup and handle pattern is eliminated and I don't think that's going to be eliminated until we go let's say below

220 we'll see if that happens or not but right now there's still a risk to the upside of Reb Bound in apple looking at

Nvidia what do we have here double bottom at the 100 days moving average almost above the 50 in blue and now we

have resistance at 14654 is that is sort of a shoulder line we're trading above

two days in a row so the next resistance would be the previous highs around 153 can we just do it in a straight shot or

do we give up 14654 tomorrow that's the dynamic I want to watch for because if we give up and print a reversal candle

such as a bearish and gulfing candle it could say wait a minute here we made a lower High we don't have the energy to

trade above 14654 we're going to go down to close the gap and maybe lose the 50 days moving average at that point uh if

we begin to see that formulating tomorrow yeah we probably want to fire up the 145 140 puts as a starter for

next week and then see what happens because if you look at the hourly chart similar to Apple the threat of a cup and

handle pattern is not eliminated yet looking at the second indicator which is bond yields can we say a higher low at

least for now let's see how we're going to close the week but if we do that anything sensitive to bond yields will begin to suffer I know the xhb caught a

rebound for example this is the weekly chart for the home builder ETF it's above the 50 weeks moving average but it could be a false break above as we've

seen in many charts before so I would say closing below the 50 weeks moving average tomorrow and the xhb will tell

me that hey look at bond yields if they're going higher initiate a shorten the xhp because it could be sort of a

head and shoulder is and we break below the 50 and we're head down in an aggressive fashion uh same goes for the

rty Russell 2000 little bit of a rebound today but it's stopped short of the 50 days moving average so if the TLT

continues to go down I think that the rty will find it really really hard to Define that and we'll go down with the

TLT the K we don't have anything to do here because it is sandwiched between the 50 in blue and the 100 in red give

me a break either way I got a trade for you break above the 50 we go with the calls break below the red line the 100

then we're going to go with the puts look at the xlu it was a little hot today in the morning but it gave up the majority of the gains why because bond

yields went back up so if the xlu new is the 50 days not weeks days tomorrow days

moving average you probably want to take shorts beginning with Constellation Energy the third indicator is the dollar

we're all watching the Japanese end right now it appears as a bearish engulfing candle meaning the end goes higher Dixie flushes down if that is

case it'll be good for gold but a lot of folks talking about the the Revival of the carry trade uh from the summer of

last year that's not an immediate threat right now because the zone is a little above here in the weekly chart of the

Japanese Zen versus the US dollar what we're looking for is maybe a higher low situation where the Japanese Yen begins

to find the footing and then in time we see short squeezes and such that leads us to the carry trade zone then we see

chaos in the US market what is that going to do to Gold if the Japanese Yen goes higher dollar goes down probably

gold is going to break above the resistance here but I got to see it to believe it to be honest with you uh I'm

skeptical that gold will make a break if it does then it's going to open up a new trade we're going to have plenty of gains to come so you can add to your

position in G or gold Futures but right now I'm holding as it is not adding not cutting just holding as it is the

miscellaneous charts about Tesla topping in the shoulder sure we close below 417 so the next rational conclusion is we go

down to 400 but bear in mind in tomorrow's sessions with the options expiration it could be sort of a falling

wedge that leads to a move above 417 but here's the risk for Tesla on the daily chart look at the 50 days we're way

Divergent from the 50 days moving average at some point you're going to have to kiss the 50 as I'm highlighting

before there was a rally last year around the summer but then Frizzle down and Tesla had to retouch the 50 could it

be the case right now sure but what is the big deal if we go down to the 50 at 389 and a half 390 is that a big deal no

it's not a big deal but if we lose the 50 and we see that macd indicator in the daily kind of reversing back to the

downside it could be an aggressive move to the downside and I think it's going to that if that happens it's going to happen because the bad report from Tesla

coming out uh in the beginning of next month it could be sort of an inverse ABC breakdown but one step at a time folks

BTC what do we do here bullish case you got the double bottom we're breaking above 104 we don't have a weekly closing

though so you get a hold of your horses uh bearish case maybe momentum stalling and reversing back to bearish lots of

volatility in BTC so you can't really guarantee one way or the other we got to see a weekly closing to be sure the

other chart that caught my eye today is mgni this is for magnite so I talked

about buying trade dis but I might add magnite here mgni and if it works better

than trade disk I'm just going to stick with it cuz from a value perspective Maybe it's a little better than trade Des we see a weekly chart here forming a

bull flag you zoom into the daily chart maybe we have a reversal from bearish to bullish so the way I'm going to do it

here maybe follow this trade that we have somebody bought the 19 calls today on mgni for the expiration date of June

20225 it's spent about uh $120,000 so uh if it closes above 19 if

there's a huge breakout it's above 19 you can exercise and own the shares at that point so that could be one way to

do it another way of course is to buy the shares sell some covered calls set a stop loss that way if it doesn't go your

Outlook

way uh you get out with minimal damage if any really let's move on to the conclusion of this video what do we have

in the economic calendar tomorrow we have a little more than what we've been used to throughout the week so we have the flash PMI including services and

Manufacturing will be important of course we got existing home sales and we have the consumer sentiment reading the

final reading from the University of Michigan any notable earnings on the calendar tomorrow yes we have plenty of

them so tomorrow we're going to have uh American Express really important a pulse on the afteron consumer Verizon

next era energy a progressive crown castle in real estate Last Vegas Sands

all of these are important uh so it's going to be another interesting session tomorrow but the most important thing is of course the options market dynamics

folks we're just going to wrap it up right here I hope you found the show informative and you learned something from it uh but thank you for listening

thank you for watching I appreciate and love all of you be talking to you again tomorrow good night whiffle ball can you

lose your rent playing no I couldn't lose that's the point no Mike you can lose all right I watched you I stood by

you while you lost everything before and I don't think I can go through that I wasn't going to L why why does this still seem like gambling to you I mean

why do you think the same five guys make it to the final table of the World Series of Poker every single year what are they the luckiest guys in Las Vegas

it's a skill game