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
With markets at highs, everything looks like a buy however we have seen some weakness pop its head out here and there. We did a great job taking advantage of the weakness in healthcare grabbing great stock in MRK. When we are near highs or lows in the market there tends to be this over focus on what the markets are doing, across all major markets and sectors we know our outs. If the market wants to trade higher, we will be in, if/when the market wants to turn, sure we will give back a few percent however there is nothing to worry about.
Scanning all the major markets, there looks to be great opportunities in India (INDA) and Russia (RSX), Europe, Emerging Markets and China are all doing well, along with our markets at highs. When everyone is winning, we tend to keep drifting higher until dumb money starts to brag about the market and we are not quite there just yet.
Often times we try to make things more complicated because we feel work is required to make money, which to a certain extent is true, however it still boils down to keeping it simple and letting the charts do the talking.
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Macro Rotation Outlook
Cheat Sheet
Nasdaq 7700 stop
S&P 500 288 stop
Dow Jones 260 sop
Mid Caps 350 stop
Small Caps 155 stop
China 100 stop
Japan holding
Europe holding
Emerging Markets holding
India 36 DCA
Russia 22 DCA
Bonds boring
10 Year at 2.53%
USD flagging
Oil short term high
Nasdaq
Resistance becoming support for now, stop 7700.
SPY
As much as everyone is expecting the market to crack, it usually likes to lure the suckers in, these steep up trends also do not last, so keep its simple, have stops in and focus on your stocks.
Dow Jones
Stop 260 as the retest of highs here is more of a layup than anything else.
MDY Mid Cap Stocks
Stop below 350 and we should see a retest of 370.
IWM Small Caps
Strong break on Friday, a stop below 155 and if we give it some time we should see a retest of 170.
GXC China
Stop below 100 and let it work.
EWJ Japan
Inching higher, a break of support we could see a similar outcome to that in energy.
VGK Europe
Similar to the Emerging Markets, just give Europe some time and it will be back at highs.
VWO Emerging Markets
Give it some time and we will be retesting highs.
INDA India
Like Russia, India is look prime for the picking through 36.
RSX Russia
22 is looking textbook, a break of that should start the trend to new highs.
BND Bond Market
Boring bonds never doing much.
10 Year Treasury Note Yielding 2.53%
3 Month Treasury 2.43%
2 Year Treasury 2.33%
5 Year Treasury 2.33%
10 Year Treasury 2.53%
30 Year Treasury 2.94%
USD
Still flagging.
OIL
Seems we may have seen a short term high in Oil after the 50% retracement off lows.
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VDE Energy
We can see when the channel breaks a new pattern has to emerge, could easily see this sector continue to bounce and roll over to retest lows as we saw somewhat similar in healthcare a few weeks back.
VIS Industrial
144 stop.
VOX Telecom
Hand sitting.
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Cyclical - sectors that are more sensitive overall market conditions.
VAW Materials
120 stop.
VCR Consumer Discretionary
Retesting prior highs, 176 stop.
VFH Financials
68 stop.
VNQ REIT
84 stop.
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Defensive- sectors that tend to outperforming during sub par market conditions.
VDC Consumer Staples
146 stop.
VHT Healthcare
156 stop.
VPU Utilities
126 stop.
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Sub Sector Rotation
Cheat Sheet
IBB could nibble 108
IBB Bio Tech
Could nibble on this 108 level.
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The New Big Picture Set Up
The Big Picture MKC $200+ 12 Month Target
The first time MKC put in a new high it proceed to get smoked after grinding back to highs, the recent pull back has been nothing to lose sleep over. This might not go 9:30 Monday morning however when it does break 156 I will want to be involved.
Big Picture Target $200+
Big Picture Entry $156.05
Stop $148.89
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The Big Picture's Updated
The Big Picture MU $90+ 12 Month Target
I can't believe I am talking about MU, if you know me, you know how much I hate the semi space, nothing to do with the business, just the crowd who hung around in AMD and MU. Now Dumb Money has the attention span of a gold fish and has to run to the next fad. It is in their DNA, after the 50%+ breakdown, most of the dumb money suckers took their L and moved onto Bitcoin and lose their and are now figuring out the next place to lose their shirts. Once I figure that out you will be the first to know.
Now given how much I hate the name, makes me like the set up even more, because charts don't lie. Last time Shake called that sick move through $44. I am not expecting anywhere close to that type of explosive move due to all the overhead supply. With that being said, if we can start picking up shares through this level maybe just maybe we can hold ourselves accountable for the retest of 64. Sure we failed being patient enough with HD so why not try to improve on this skill with MU?
Was early on the entry however it continues to get tighter and tighter, for as much as I hate this sector since dumb money loves it as much as bitcoin, this chart doesn't lie that this 44 level has some solid resistance, will add on the 44 break.
Big Picture Target $90+
Big Picture Entry $44.05
Stop $39.89
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.
Was a great swing, sure we didn't get the bigger move we were looking for, this was a great example of precision style stops, have to thank Shake for holding that $74 level so we could squeeze another $2 out of it, still looks great and have no problem buying it back if it sets up again.
No Position
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.
Great example of a trade that worked however my execution failed me. If you are still in stop below 69.
Big Picture Target $90+
Big Picture Entry $67.05
Stop $68.89
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.
Breakeven trade for myself, if you are still in and give it a little more room, it could have room to run above 63.
Big Picture Target $70+
Big Picture Entry $60.05
Stop $59.89
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.
Like PGR, we got a nice swing out of the name however the bigger move was just not there yet. If you are still in a 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.
Hold your winners.
Big Picture Target of $54 exceeded
Stop $61.89
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Trading Experts Miami/Bimini Bahamas
We might be Trading Experts, however we are no photo experts, this was the only photo we took the whole weekend, there were a few funny highlights from the trip last week:
Kriss, Heaven, Capt Joe and Skender all won money at the casino, which was awesome to see them all actually leave with more money than they came with.
Getting to South Bimini required a bit of traveling taking ferry to ferry and having golf carts on both island, however the views on that private island especially at night were simply unbelievable.
Our goal was to see one of the sunken ships that was about 5 miles off the coast, after talking with a few locals, our friend Coconut Joe said he had one of the best captain on the island for a price only a fraction of what we have paid in the past to charter boats in Exuma and Turks. I didn't bat an eye as he mentions the boat is not "that pretty", when the guy pulled up, it was basically a drunk homeless man driving a 30 year of raft with a moped engine attached. One being all for adventure, we hoped in and set sail on a trip where we almost had to kill a man.
At first the drunken hobo was funny, however after he drunkenly pulled out his machinate and told us he was friends with Bill (Gates), we noticed some trouble, now obviously nothing actually happened however there were a few tense moments, at one point Kris was about to throw the guy overboard after his phone fell in the water. I eventually did (throw him overboard) which is still one of my highlights of the trip. We dropped everyone off on the beach and I stayed back with the hobo to go get our golf cart at the other end of the island, my buddy Skender stayed back with me, the captain said I could drive the boat(raft), so as he stood up to let me take over the controls, I ripped the steering wheel and sent him flying over the side of the boat, the look on this hobo's face as he fell off the side fully dressed will forever be locked in my head. He was quick or maybe the boat was just that slow that he was able to hold onto the back of the boat, so we had to pull him back on board instead of leaving him in the ocean.
All in all, the trip was a great success and having a smaller group it was much easier to move around, explore and share real experiences. As much fun as the huge group trips are, its hard to get those 1 on 1 connections with some much going on. I have not even began to think of the next trip however it will most likely be some time in the end of July. If you are interested in coming, let me know, as I would like to keep it like this trip of half a dozen members.
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