The Big Picture

by Ben G April 20, 2019

The Big Picture Outline

- Financial Planning

- Broad Market Outlook

- Macro Rotation

- Sector Rotation

- Sub Sector Rotation

- New Big Picture Idea

- Updated Big Picture Idea's

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Financial Planning

Take any hundred people at the start of their working careers and follow them for 40 years until they reach retirement age, and here's what you'll find, according to the Social Security Administration:

1 will be wealthy, 4 will be financially secure, 5 will continue to work because they need to, 36 will have already died, and 54 will be broke living off Social Security and help from family. 5% are successful while 95% are unsuccessful. Care to guess which group had financial planning?

Clients pay thousands of dollars a year to have a financial plan run for them at my investment bank, we include this benefit to you for no cost. If you would like us to put a plan together for you and your family so you can get closer to being in the 5%, shoot me a message on GroupMe saying "planning" and we will show you the simple steps to get you to your first your first million.

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Broad Market Outlook

The market is continuing its run to retest those highs, most of the end of year talk was around the trade deal and future earnings, most set such a low bar for Q1 earnings, that if companies just barely exceed expectations we should see good reaction from stocks and the market itself (Do NOT take this as an excuse to gamble on earnings).

This whole time we have been leading on the camp of retest prior highs, get met with sellers and pull back a bit, however what if we are wrong? What if we want to break out to new highs? Regardless of what the market does or the stock you buy if we continue to do what works, we will be rewarded. Buy on the way up, have our stops in, and let them do the heavy lifting.

Outside of the market, we saw the biggest gains to date, there were 4 members who switched to bi weekly payments, in total that will save them over $400,000 in unnecessary interest payments. Now as an advisor my goal is to help you grow your account, yet the biggest advantage for most is cutting down there biggest liability first, which is their mortgage. We receive the most friction from making this simple switch (ex paying $3,000 1 time a month, to $1500 1 time every 2 weeks), its the same amount however its so simple that it forces person to admit that what they were doing wrong because they listened to everyone else who listened to the mortgage lender (who has an incentive to keep you as a sheep), its all ego for most wanting to stay being a sheep, the ones who make the change and can say "I was wrong, I need to change" benefit the most, forget the ego and focus on the dollars, its much easier that way. For the members who are saving a few hundred thousand dollars in interest payments big ups to you guys!

From Ben G

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Macro Rotation Outlook

Cheat Sheet

Nasdaq inch away from all time highs

S&P 500 inch away from all time highs

Dow Jones inch away from all time highs

Mid Caps lagging behind the large caps

Small Caps lagging behind large and mid

China grinding higher

Japan flagging under 56

Europe breaking downtrend

Emerging Markets grinding higher

India flagging under 36

Russia flagging under 21.50

Bonds pulling back

10 Year at 2.56%

USD still flagging

Oil still grinding higher

Nasdaq

A mere 100 points away from retesting all time highs.

SPY

A mere 4 points away from retesting all time highs.

Dow Jones

1% away from the market is perfect.

MDY Mid Cap Stocks

Mid caps lagging a bit however the overall tune seems to be a retest is in the cards.

IWM Small Caps

Small caps lagging far behind the large and mid's trying to play catch up.

GXC China

Just remember how at the beginning of the year the head lines were "expecting worst market" in years, and soon we will be seeing the "best market in decades!"

That double bottom held like a champ!

EWJ Japan

Japan still flagging down here, keep an eye on that 56 level.

VGK Europe

Europe finally starting to poke out of this downtrend, for now its really sit on our hands time to give it time to work higher.

VWO Emerging Markets

Emerging Markets are showing what could be in store for Europe as it continues to break the downtrend. Hand sitting time.

INDA India

India is looking sick, one of the wildest markets ripping 10% up, down and around like its no one business, this 36 level looking solid in time.

RSX Russia

Russia has been setting up for a while now and I picked up some last week yet it was not ready, not the end of the world just have to be ready to add again.

BND Bond Market

Doesn't hurt to have some bonds for the rainy days, trying to trade them is a waste of time and energy.

10 Year Treasury Note Yielding 2.56%

People in finance love to add 1 extra layer to confuse everyday people, look at any financial newspaper, and the yields below will be all out of order, just enough to make you scratch your head.

To keep it simple, below they are in order from shortest to longest maturity, in simplest terms, if you were loaning money to a friend for a week or another friend for a year, which would you charge more? The longer loan, same goes for the market, when you are charging more for a shorter term loan that shows your lack of confidence in the market. With the 3 month yield more than the 2 and 5 year, not the best sign.

3 Month Treasury 2.38 %(Should be lower than the rest)

2 Year Treasury 2.40% (Should be lower than the rest)

5 Year Treasury 2.37%

10 Year Treasury 2.56%

30 Year Treasury 2.97%

USD

Still flagging.

OIL

Oil still trying to inch higher and higher and work its way back to those prior highs.

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If you have a friend that can benefit from what you have learned with us, shoot me over there contact info and we will see if we can help.

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Sector Rotation

Key points

- For any of the major markets or sectors, we are parking these positions in a taxable account looking to hold for a year plus (Long Term Capital gains)

- Meaning we are willing to hold positions against us as overall sectors and markets are much less volatile than individual names.

- We are buying or adding (dollar cost averaging) when there are actionable set ups.

- We are selling for either profit or getting out for breakeven if better opportunities arise elsewhere in other sectors.

- If you plan to add this strategy to your portfolio please discuss it will me so we can make sure you are not parking these ETF's in retirement accounts locking up tax deferred capital that can be put to better use in individual stocks.

Cheat Sheet

VGT 202 stop

VDE 92 resistance

VIS 140 stop

VOX 88 resistance

VAW 126 stop

VCR 176 stop

VFH 63 stop

VNQ 84 stop

VDC 142 stop

VHT 174 DCA

VPU 126 stop

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Sensitive - sectors that have moderate correlations to overall market conditions.

VGT Tech

Could the broad market follow suit?

VDE Energy

Still having some trouble at the 92 level however might not be trouble for long.

VIS Industrial

Industrial's showing up they want to work on that major level of 152.

VOX Telecom

Telecom finally broke the 2 year downtrend and now it has to battle with 88 which was resistance all of 2018.

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Cyclical - sectors that are more sensitive overall market conditions.

VAW Materials

126 stop and let it work.

VCR Consumer Discretionary

176 stop and let it work.

VFH Financials

4th time at this 68/50 area.

VNQ REIT

Leave that stop in and let it work higher.

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Defensive- sectors that tend to outperforming during sub par market conditions.

VDC Consumer Staples

146 DCA

VHT Healthcare

174 DCA

VPU Utilities

126 stop

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Sub Sector Rotation

Cheat Sheet

IBB 106 stop

IBB Bio Tech

106 stop

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The New Big Picture Set Up

The Big Picture IP $67+ 12 Month Target

We have been hawking this IP 48 for some time now, I have been trading around in IP since 2017 and have caught a few nice trades in it. This 48 base break on 2 dollars risk looks worth the cost of admission.

Big Picture Target $67+

Big Picture Entry $48.05

Stop $45.89

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The Big Picture's Updated

The Big Picture PGR $95+ 12 Month Target

PGR has gone on a crazy run this year and has started to flag exactly how we would like to see it, I started a feeler position to keep an eye on it, and will look to buy through 74.

One of the free members, actually sent this in as a short idea, flipped his short entry to my stop and his buy cover to my add and it is working nicely so far. Can add 73, real add will be 74.

Big Picture Target $95+

Big Picture Entry $74.05

DCA $73.05

Stop $70.89

The Big Picture INXN $90+ 12 Month Target

Back in 2018 you might remember trading INXN however it just was not ready, and we moved on, now its right back to this level and looking better than ever on even tighter risk.

Added through the 69 high, with a stop at 67.

Big Picture Target $90+

Big Picture Entry $67.05

Stop $66.89

The Big Picture MTCH $70+ 12 Month Target

This 60 level is looking great for a nice 4th times a charm vs 52 for now.

Still setting up perfectly.

Big Picture Target $70+

Big Picture Entry $60.05

Stop $51.89

The Big Picture EXPD $73+ 12 Month Target

EXPD has been setting up similar to FIS, defined level of resistance, has attempted the level over 3 times and is showing us a nice clean out vs 73.

Added through the 79 high with a full stop below 77.

Big Picture Target $95+

Big Picture Entry $78.05

Stop $76.89

The Big Picture CDNS $54+ 12 Month Target

So we are shifting gears away from the large cap names and taking a look at CDNS that has been setting up through this 47 level since July. Now this is by no means a cake walk 47 buy as it has ran basically in a straight line up from 40. Will start light and if it wants to blast 47 and never look back even better, if it wants to start setting out we should have not problem adding in time.