Share to Facebook Share to Twitter Share to Linkedin We’re almost halfway through the year. So, where do things stand with stocks, precious metals, and the options markets? What’s likely to happen next? And what strategies make sense as we head into the summer months? Find out what four of our top MoneyShow expert contributors have to say this week. Steve Reitmeister Zen Investor Here is one of my favorite investing expressions: It’s a bull market ‘til proven otherwise. This is not just a cute saying…but indeed very sound advice. That is because there are far too many experts talking about dark clouds that never lead to a true downpour. The fact is that the economy is kind of like a helium balloon. Its natural propensity is to float higher. Thus, it needs a strong opposing force to keep it down. In terms of the stock market there are only two forces strong enough to beget a bear market: Recession Equity Bubble Right now, there is no sound reason to worry about a recession. Even if one did seem to be emerging, it would finally put a nail in the coffin of high inflation that would allow the Federal Reserve to start cutting rates. That would be a catalyst to restart economic growth, leading to a quick turnaround in stock prices. As for an equity bubble…it’s not even worth wasting a moment longer contemplating that as we are far from that being the case. So, with no reason to worry about a bear market…then we are left to talk about whether we have a mild, medium, or hot bull market on our hands. To be fair, the hot phase has already happened given a greater than 50% rise from bear market bottom just 19 months ago. That is fairly typical new bull market behavior. At this stage, we are in a mild-to-medium bull market where annual gains for the main indices will come in closer to 10% per year. MORE FOR YOU Microsoft Issues New Warning For 70% Of All Windows Users Forget iOS 18 Millions Of iPhone Users Now Have RCS Messaging Samsung Issues Critical Update For Millions Of Galaxy Users Shorter-term, we keep bumping up against the highs and don’t seem to get much higher. That’s because the long-awaited catalyst for further stock gains (Fed rate cuts) keeps not happening. While we may need to wait all the way to the Fed meeting where the trigger is finally pulled, I liken this situation to a car idling at a red light. You know it will turn green soon enough…so you keep your eyes pointed ahead and ready to punch the gas pedal. This also means that any pullback or correction is likely to be relatively shallow and short lived. SPX Zen Investing The current top end is framed by the recent high of 5,341. Whereas 5,000 seems like pretty solid support on the downside…we may not need to slide that far with the 100-day creeping up on 5,100. That is a fairly standard-sized range to swash around in for the time being. But once we have greater certainty on the timing of rate cuts, the more likely a bull run will start to press to the upper end of the range…and soon enough, a break to new highs will commence. Back to the start of the conversation: We are in a bull market ‘til proven otherwise. Thus, best to be fully invested as the next bull run can start any time for any reason. Danielle Shay Fivestartrader.com June is here, which means kids are getting out of school for the year (if they haven’t already), people are taking vacations, and everyone is spending more time outdoors. These factors typically lead to lower-than-average trading volume. But never fear. There is always something out there to do, even if it looks different. Check out a chart of the Invesco QQQ Trust (QQQ) below with volume overlayed on the bottom in blue. Eyeing a chart like this can give you an idea of when the highest volume days occur (generally when the market is pulling back), and also give you an idea of how volume is trending. When volume is greater than average, you generally see more volatility and directional trading opportunities. When volume declines, the VIX typically declines, which can lead to less directional opportunity. Chart FivestarTrader.com Take a look at the VIX daily chart below. As volume declined to the lows on the year in the QQQs, we also saw the VIX decline to the lows on the year at a value of 11.52. Chart FivestarTrader.com When the VIX is below 17, this is considered a low-volatility environment. This environment is typically best suited for buying the dip, focusing on relative strength stocks, and using strategies like buying calls or selling put credit spreads. When the market is in buy-the-dip mode, selling premiums like selling covered calls, selling put credit spreads, or selling iron condors (also known as iron flies) can be a way to take advantage of the summertime slump and sideways-to-upward action. Of course, the low VIX means the premiums aren’t as juiced up as when the VIX is above 17. That means you will get a lower premium than you could have earlier in the year for selling the same spreads. But the benefit is that with less movement, you can be more likely to be right just because there is less market movement. Another way I like to take advantage of this sluggish direction is by buying butterflies. In the butterfly, you are directionally long, but the center strikes are short, so in a way, you are taking advantage of selling premium as well. This strategy can help immensely when the market isn’t moving as much because if the long call isn’t exploding, you can still make money on the slow grind with the decay of the center strike on the fly. Avi Gilburt, Esq ElliottWaveTrader.net I have been publicly providing market analysis for the last 13 years – and one of my first market prognostications was presented in the metals market. Now, I want to share my updated projections for gold and silver. In late 2015, I was seeing signs that gold was bottoming, and outlined to my clients that we may come up a bit shy of the $1,000 downside target I had previously published. On Dec. 30, 2015, I penned the following message to those willing to listen: “As we move into 2016, I believe there is a greater than 80% probability that we finally see a long-term bottom formed in the metals and miners and the long-term bull market resume. Those that followed our advice in 2011, and moved out of this market for the correction we expected, are now moving back into this market as we approach the long-term bottom.” Last year, I attempted to get readers focused on the metals again, as I wrote several public articles during the last half of 2023 outlining my bullish expectations for them over the following year-plus. In fact, back in October 2023, this is what my SPDR Gold Shares ETF (GLD) chart was projecting: Chart ElliottWaveTrader.net Then in February 2024, this is what we were showing: Chart ElliottWaveTrader.net As you can see, we have rallied to our target for wave iii, and have consolidated in wave iv, as expected over half a year ago. In my prior articles, I also outlined my initial target of $2,428 for gold (which we did just exceed before this consolidation). Now, I am expecting that we will likely move up to the $2,700 region in gold for the next rally I expect to begin over the coming weeks. However, I see much greater potential in silver at this time. Whereas gold has already seen its wave iii rally, silver has not. Therefore, I am expecting a major catch-up move in silver during 2024, which can even take us beyond the $40 mark in quite a rapid move. Therefore, my main point is that I am now tracking a pattern which suggests that this pullback can complete in the near term, and set us up for the next phase of the rally I expect in the metals market. However, in the next phase, I am expecting silver to outperform gold. Luke Lloyd Strategic Wealth Partners Luke Lloyd is a wealth advisor and investment strategist at Strategic Wealth Partners. In this MoneyShow MoneyMasters Podcast episode, which you can watch here, Luke starts by talking about “one of the biggest contributing factors keeping this whole economy afloat” – the debt cycle. He says the government is racking up $1 TRILLION in new debt every 100 days…consumers are increasingly using “Buy Now, Pay Later” plans to fuel spending…and corporations are refinancing old debt with new debt carrying higher interest rates. Luke then talks about the Federal Reserve’s role in all this debt creation, while sharing a key reason why higher rates haven’t really bitten when it comes to the economy or the stock market. He also highlights the one thing that could mean “the banks stop giving you money and credit card companies stop giving you money,” upsetting the borrow-and-spend dynamic. Next, we shift to politics and markets – including what shallow (and deep) corrections mean for an incumbent president’s election chances, as well as what Trump or Biden victories would mean for investors in terms of stock and sector selection. Luke and I then chat about a wide range of topics, including his favorite AI plays, stocks that will benefit from the “addiction to lifestyle” trend, which sub-sector in the energy space looks most attractive, and why and how investing in gold can pay off. We conclude with a quick chat about what Luke will cover at the MoneyShow Masters Symposium Las Vegas, set for Aug. 1-3, 2024 at the Paris Las Vegas Follow me on Twitter or LinkedIn. Check out my website or some of my other work here. MoneyShow Following Editorial Standards Print Reprints & Permissions
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