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Finding A Home In The Range
Looks like the consummate professionals on Wall St. have pulled off yet another masterpiece. They were able to cobble together the bullish conditions necessary for the upcoming Anthropic IPO. Back in July, I suggested that the pros on the Street would stop at nothing to get a series of successful IPOs out the door. It appears as though they will overcome all the odds against them and foment demand for another block buster stock offering. The successful IPO of one of the big, household name AI companies was always the key ending to this AI story. Wall Street must show that it can create a successful narrative that sells financial assets. Even after this credit cycle finally ends, the business owners of the world will remember that Wall St. banks can still sell merchandise no matter how dire the conditions. The financial conditions are dire under the surface regardless of what the index levels say. Capital is getting scarce, and the most marginal users of that capital are getting priced out. Some of the business models that depended on 3% rates to operate will be gone within the next year. Other than the biggest player in the space, Ares Capital, all the private credit names are down for the count. The chart of Blue Owl, OBDC, is representative of most of the names in the space. OBDC: These marginal users of capital, the junk bond spreads, and consumer sentiment all tell the truth better than a stock price index like the SPX. The truth is that this business cycle is ending, and we’re already in the contraction phase. But just because the signs are now obvious that the economy is contracting due to higher costs of credit, it doesn’t mean the SPX has to play along and go down. Because it’s imperative for Wall St to get an AI IPO out the door, they will move mountains to create the conditions required for a successful IPO. The first condition is that stock prices don’t decline. Stocks don’t have to go up necessarily, but they mustn’t break down. Below is a chart of the SPX with two particular days annotated. The first is August 4, the day when the number of traded call options on the SPX reached 4 million, an all time high. You can see that the index’s upward thrust was halted. The second day annotated is this week, Oct 19, when an all time high for put volume traded. It would be safe to assume that, just as record call trading halted upward acceleration, any downward acceleration in price has now been taken off the table with a massive open put position. SPX Rangebound: And just like that, an October crash is likely averted. With so much open interest in options with calls defining the top of the range and puts defining the bottom, the market is likely stuck in a range for some time. This is a market that is in balance between buyers and sellers. We’re going to need something unexpected to force the market into an imbalance where it can trend. Until that something occurs, I’m going to try to stay in the game by sizing down, buying weakness, and selling strength. That’s the opposite of what I’d look to do in a trending market where buying strength in breakout trades has a higher probability of working. The type of stocks I’ll look to buy will change as well as the market trades in a range waiting for one side to gain the upper hand. I’ll be looking to bid for stocks that fit with the contraction phase theme. That would be the defensive sectors like medicine stocks. TEVA, BIIB, AUPH, MRK, LLY and JNJ all have the right looking setups, and they all fit in with what the XPH Pharmaceutical ETF is doing. The XPH is holding at the 200 day moving average around $61 and has a low risk stop just below. XPH Trade Plan: This contraction phase should offer some very good opportunities to pick up long term assets that will pay us to own them. Those assets will have to offer better than the 5% we can get with Treasury Bills. That is a hard hurdle to jump over, so stock prices will have to come down significantly. Stocks are a speculative asset, and as such, we shouldn’t even think about owning them unless there is a sufficient margin of safety with a cheap price. Stocks this expensive are for renting only. The last time there was a glaring opportunity to buy long term assets was in 2023 when gold mining stocks were in the doldrums, and central banks were buying gold every month. The price had to rise over $2,000 at some point, but nobody wanted to wait in gold mining stocks at the time. They were a screaming buy. Before that, the opportunity to pick up long term assets was when crude oil crashed in March of 2020. Energy stocks were hated, ESG was all the rage, and because of that, big institutions were underweight energy stocks. The decline in March 2020 was the final leg down that offered patient buyers tremendous assets at discount values to park away in long term ownership. I had held EPD for a long time, but never got the chance to get a big position until March 2020. We will get the opportunity to pick up a left-for-dead sector once again, and indeed, it may already be here for one sector in particular. The housing related stocks have been killed since the 2021 real estate boom ended. After this contraction phase runs its course, the early expansion phase should send housing stocks much higher. I’m looking at names that are tangentially related to housing like WY, WHR, SHW, FND, SWK, ETD, and MHK. These stocks are getting cheap, and a couple are already priced for a severe depression. They’re not out of the woods yet, as we haven’t gotten through the worst
Continue Reading -->My #1 Stock Picking Secret: The Rerating
David Prince finds his biggest stock market wins when something unique happens: a “Rerating” Think of it like this: everyone looks at a company and agrees it is a square. Then, fresh news drops and we are looking at a circle. The people who recognize that shift first make the most money. Because the stock’s valuation is “rerated” higher. Here’s how it works: This happens when panic gets out of hand. Not long ago, investors worried that AI would destroy the software sector. Big names like Salesforce (CRM) and Atlassian (TEAM) w\saw their stock prices crash as people assumed the glory days were done. But the reality turned around fast. Strong earnings, massive insider buys, and major partnerships—like Salesforce teaming up with Anthropic—proved that the story changed. Anthropic’s Claude was supposed to destroy Salesforce. Nope. They are actually buddies. The square became a circle. Meta (META) saw the exact same change in perception. For months, Wall Street doubted whether spending billions of dollars on AI would ever pay off. That skepticism vanished once Meta announced the Muse AI agent. As soon as people saw practical products that could work in the real world, the entire story behind the stock changed. It went from “far behind” to the driver’s seat. And if you can spot that ahead of the crowd you win. Huge!
Continue Reading -->Bitcoin Beats SpaceX. Here’s Why.
ATTN: Sami Abusaad and James Rich Young’s next Pristine Mentorship starts this Saturday. There are just 3 spots left so consider signing up now. SpaceX (SPCX) looks okay after earnings. Nothing special. You know what does look good? Bitcoin and crypto currency stocks like MicroStrategy (MSTR) and Coinbase (COIN). Sami Abusaad explains: Reading the Charts: Simple Lessons from Crypto, Gold, and Market Hype When markets get chaotic, it is easy to glue your eyes to every breaking headline. Or you can do what Sami does. Go tot he charts. Take crypto, for example. Instead of sliding after its big rally, Bitcoin held steady near its recent highs and built a solid, rounded base on the hourly chart. That quiet strength gave crypto-linked stocks like MicroStrategy, Coinbase, and Robinhood (HOOD) plenty of room to take off. When a market refuses to drop on pullbacks, it usually means buyers are quietly waiting in line. Gold is setting up a similar opportunity. On the monthly chart, gold pulled back to a sweet spot right along its 20-period moving average. While broad funds like GLD can feel sluggish, individual gold and silver mining stocks often offer cleaner charts and bigger upside for buyers looking to get in. Energy stocks show this same forward-looking behavior. Meanwhile, The energy sector (XLE) has steadily pushed higher, proving that price action usually sniffs out geopolitical tensions and supply shortages well before they make the evening news. Treating charts as your main guide does not mean ignoring the real world completely, but it does mean being selective. News really only matters when it drives a mechanical move, like in a secondary share offering. When a company sells extra shares, the stock often gaps down hard at the opening bell. Once that initial wave of panic selling dries up, dip-buyers frequently step in to ride the bounce back up. The biggest lesson right now is knowing what to buy and what to leave alone. A giant like Tesla (TSLA) might look strong on longer charts, but chasing it into resistance right before earnings is an easy way to get burned/ waiting for a pullback offers a much safer entry. Meanwhile, former market favorites like space stocks AST Spacemobile (ASTS) and RocketLab (RKLB) have broken below key support levels. Once the excitement fades and the chart breaks down, it is usually best to step aside and let the market find its floor. Want to go elite under Sami’s watch? Consider his Pristine Mentorship, which he co-leads with James Rich Young.
Continue Reading -->SpaceX Stock: I Believe
Want 14 FREE days with JR? Go here. JR Romero is a long-term believer in SpaceX (SPCX) stock, and here’s why: Starlink is firing on all cylinders. And Elon Musk is doing a great job as positioning the company as a premier neocloud. Get the full breakdown of SpaceX in this video.
Continue Reading -->Is AI About to Die?
Want 14 FREE days with JR? Go here. AI earnings are kicking off with SpaceX (SPCX) and Meta (META) this week. JR cuts through the hype to give you the real big picture on AI: As a pivotal tech earnings wave hits Wall Street, fears of an AI bubble and runaway capex spending have triggered sharp volatility across semiconductor and mega-cap tech stocks. JR slices and dices the market noise to explain corporate fundamentals, infrastructure risks, and actionable trade setups designed to help investors navigate the turbulence. AI Reality Check vs. Bubble Fears We tackle comparisons between current market conditions, the 1999 dot-com crash, and the 2008 credit crisis. Tier-1 market leaders like Micron (MU), Nvidia (NVDA), and Meta (META) remain supported by genuine EPS acceleration rather than pure speculation. The discussion also explores emerging credit risks surrounding debt-heavy compute providers like CoreWeave (CRWV), contrasting today’s exponential demand for compute against 1990s telecom buildouts (think Global Crossing) where excess fiber capacity sat idle. Policy Hurdles, National Security, and SpaceX Beyond the balance sheets, we go over potential regulatory headwinds, including proposed legislative moratoriums on AI data center construction. Reality: aggressive restrictions are unlikely to derail the sector, given that digital infrastructure is increasingly treated as a critical national security priority. We also go over SpaceX’s earnings potential, covering everything from Starlink subscriptions to compute leasing developments, so the persistent speculation about a possible Tesla-SpaceX merger. Actionable Chart Setups For traders looking for high-probability setups away from the headlines, the video breaks down key chart patterns across multiple sectors: Arcutis Biotherapeutics (ARQT): A clean base breakout supported by heavy follow-through volume. Hasbro (HAS): An inverse head-and-shoulders formation testing critical neckline resistance. Coca-Cola Consolidated (COKE): An ascending triangle coiling for a potential technical push. Amazon (AMZN): A consolidating wedge pattern setting up right before earnings, with key upside levels mapped out toward the $308–$312 range. Make sure you watch the whole video for an end-to-end look at the AI boom.
Continue Reading -->Markets in Turmoil Headlines = Buy!
ATTN: Sami Abusaad and James Rich Young’s next Pristine Mentorship is on the calendar for October through December 2026. Spots are running out! When Sami hears “Markets in Turmoil,” he wants to do 4 things: Tune out the noise Check the daily charts Identify key support Look for buying opportunities When you hear “Markets in Turmoil” on financial TV stations, it’s usually time to buy. We saw it with the bond market, which is why Sami bought TLT. And it just happened with semiconductor and AI stocks, which were under tremendous pressure. This disconnect exposes a major trap. News outlets focus on market drama when assets are actively tumbling, which is typically when traders should avoid catching falling knives. Conversely, when selling exhaustion occurs and strong technical setups emerge at support, the coverage goes silent. So hearing the phrase “market in turmoil” is usually a reliable cue to look for long entries rather than short positions. A clear example is the VanEck Semiconductor ETF (SMH). After a sharp sell-off straight into daily support, the setup was not an area to chase shorts, but an attractive spot to initiate a long trade. Similar favorable risk-reward entries surfaced across beaten-down assets, like leveraged index funds like TQQQ and TNA and high-beta stocks like Robinhood (HOOD) and MicroStrategy (MSTR). (you need a strong stomach for these. Unless a chart is establishing a rare secular top, history shows that sharp pullbacks into established support levels repeatedly reward dip buyers. The next time financial headlines declare panic across the markets, tune out the noise. Check the daily charts, identify key support, and look for the buying opportunities the crowd refuses to see. Want to go elite under Sami’s watch? Consider his Pristine Mentorship, which he co-leads with James Rich Young.
Continue Reading -->Oracle Is Not a Buy
ATTN: Sami Abusaad and James Rich Young’s next Pristine Mentorship is on the calendar for October through December 2026. Spots are running out! Thinking of buying the dip in Oracle (ORCL)? Sami Abusaad says no. See why in today’s video: The broader market enters the week in a precarious standoff between bearish breakdowns and key technical support. Sami Abusaad shows you the troubling pattern across major indices: Friday’s sharp sell-off completely erased Thursday’s bullish green bar on both the QQQ and SPY. While taking out a strong green bar is inherently bearish, the pullback landed directly into daily chart support, pointing to potential two-way chop rather than a fast decline decline. Meanwhile, small caps (IWM) and semiconductors (SMH) exhibit clear relative weakness. IWM is in a steep downtrend and SMH is dragging tech lower. So it’s time to be selective and look for longs and shorts. Long Candidates: Constructive basing and breakout patterns stand out in names like Allot (ALLT), Teva Pharmaceutical (TEVA), and ServiceTitan (TTAN). Plus, gold miners Galiano Gold (GAU) and Newmont (NEM) are looking very interestined. Short Setups: Vulnerable charts and prominent breakout failures offer clean downside opportunities, particularly in American Bitcoin Corp (ABTC), Oracle (ORCL), Rush Street Interactive (RSI), and Vistance Networks (VISN). With earnings season heating up this week with Tesla (TSLA), Netflix (NFLX), SpaceX (SPCX) and others, key technical levels may be tested. Expect choppy, back-and-forth price swings over the coming days until the market establishes a definitive trend. Only look for setups with the right risk-reward. You don’t want to get steamrolled at a time like this. Want to learn how he makes these gamebreaking ideas? Consider his Pristine Mentorship, which he co-leads with James Rich Young.
Continue Reading -->Did Michael Dell Say Buy Micron?
ATTN: Sami Abusaad and James Rich Young’s Pristine Mentorship starts soon. Check it out here.What a week! Elon Musk showed us a flying car. Inflation came in hot. And my portfolio got smoked. But… Michael Dell might have handed us a big new idea. Let’s dig in. Skip Ahead! Red October for TechDid Michael Dell Tell Us to Buy Micron?Earning Season Is Going Okay, But Could Be About to Go BOOMMeta Is Key to AISentiment Is NeutralRate Hike Expectations Subject to ChangeREMINDER: Join the Mentorship Red October for TechIt’s been a rough month for tech. QQQ is down 4.1%, while SPY is down just 0.1%. Meanwhile, DIA is up 1.9%. But bizarrely, every S&P sector is up aside from Tech and Communications.And Communications might as well be tech because it includes names like Meta (META) and Alphabet (GOOGL). If we did deeper into the QQQ’s, 55 of 101 names are up in October. Sounds decent. But the average winner is up 6.3%, while the average decliner is down 11.1%. That’s because the decliners list is dominated by beaten-up AI names like SanDisk (SNDK), Nebius Group (NBIS), and CoreWeave (CRWV). Speaking of beaten-up AI names…Did Michael Dell Tell Us to Buy Micron?A Friday Wall Street Journal article about Dell (DELL) included an interesting little nugget from company founder Michael Dell. When speaking about the memory supply crunch, he said “It’s gonna get worse.” Was he telling us to look at Micron (MU), which is trading at 5x forward earnings?Supply shortages favor sellers like Micron. And the longer the shortage, the better for Micron. However, it’s not easy to feel confident when the AI trade is taking the elevator down… Our own JR Romero is a big Micron fan. Here’s why:Earning Season Is Going Okay, But Could Be About to Go BOOMAccording to FactSet, 9% of the S&P 500 has reported earnings. 84% of companies have beaten estimates. However, Q3 earnings are now tracking to grow by 29.0%, slightly below the 29.4% expected last week. This is because earnings beats are smaller than expected, and are being offset by lower estimates in the Health Care sector. However, we are about to get a bunch of big tech earnings reports which have the potential to shift sentiment. Starting with…Meta Is Key to AIEarnings season heats up big time next week, especially in tech. Meta (META) is the biggie, especially when it comes to AI. The market is desperate for reassurance that AI infrastructure spending can keep growing. Because that spending has been key to earnings growth. So consider Meta’s capex guidance a major market catalyst. The higher, the better. (duh) Yes, we have important companies like Netflix (NFLX), Tesla (TSLA), and Lam Research (LRCX) reporting, but Meta is the big one.Sentiment Is NeutralThe latest AAII Sentiment Survey shows that 38.7% of investors are bullish.That’s pretty much in-line with the long-term average of 37.5%. By 41.6% of investors said they were bearish, which is above the 31.5% historical average. Plus, CNN’s Fear & Greed Index is at just 18/100, indicating Extreme Fear.So it looks this market’s short on joyous participants.Rate Hike Expectations Subject to ChangeEven with hot CPI and PPI reports this week, expectations for the October 28 FOMC meeting haven’t changed much, according to the CME’s FedWatch Tool. The market is pricing in a 17.2% chance of a 25 bp rate hike, down from 27.7% last week.And the market expects an 88.2% chance of at least one hike by year-end. Not a big change from last week.REMINDER: Join the Mentorship Sami Abusaad and James Rich Young’s Pristine Mentorship starts soon. Learn about it here. Want to get to know them? Watch this webinar:
Continue Reading -->How to Find the Next Dell
If you want to catch real winners in the stock market, stop digging through the bargain bin looking for “cheap” stocks. A beaten-down stock in a dying industry is still junk. Finding mega movers like Dell (DELL) comes down to identifying the real leaders and ditching money-killing habits. Here’s how Inner Circle crushed Dell, and how you can find the next huge winner: Let’s break it down: 1. Hang Out in the Right Neighborhood Nobody is getting rich buying a bottomed-out stock when its entire sector is in the gutter. You want to put your money where the action and money flow are going. Look for massive TAM’s (total addressable markets), expanding profit margins, and companies that keep beat and guide higher. Take Dell: it wasn’t just an old-school hardware company. It had front-row positioning right alongside Nvidia’s Jensen Huang during the AI boom, showing serious relative strength when the rest of the market was slipping. The company also played nice with the White House. 2. Stop Kicking Yourself Over Past Prices The easiest way to miss a massive run is getting obsessed with where a stock traded a few months ago. We’ve all caught ourselves thinking, “Man, I owned this at $100—how can I buy it again at $300?” But that’s a rookie mistake. If the company just blew past all expectations and earnings doubled, paying 20 times earnings at $300 might actually be a better bargain than it was at $100. Focus on what the stock looks like today. Not what you could have paid yesterday. 3. Take Your Chips Off the Table Even market darlings don’t go straight up forever. Every big stock from Nvidia (NVDA) to SanDisk (SNDK) to Meta (META) has had ups and downs.When the broader macro picture gets rough (rising bond yields, spiking oil prices, or global tension) the big funds will eventually cash out. As the saying goes, when the market gets ugly, they “shoot the generals” first, and then the lesser names get tkaen out. There is nothing wrong with taking profits, letting someone else squeeze out the last few dollars, and waiting until the risk/reward tilts back in your favor. Trading top-tier stocks isn’t about guessing the exact bottom every freaking time. It’s about riding the strongest horses, keeping an open mind on price, and walking away when the easy money has been made.
Continue Reading -->Assume the Crash Position
There’s an old Wall St. legend that Joseph Kennedy Sr. kept the family fortune that he amassed from bootlegging by getting out of stocks just before the 1929 crash. His opportune timing was the result of his astute observation that even his shoe shine boy was giving him stock tips. Kennedy reasoned that if even the most uninformed shoe shine boy was levering up in stocks, there was literally no one left to buy stocks. I was reminded of that legend last week standing in line at the bank. There was an octogenarian at the only open teller, and I was next in line. While patience is the only virtue I possess naturally, and abundantly so, even my heroic levels of patience wore thin as I waited for this elderly gentlemen to figure out how to use the card reader to allow the teller to access his account. He was completely oblivious to the line forming behind him as he recounted his stories from opening up his first bank account in the 1970’s while the teller came out from behind the booth to operate the card reader for the old man. His stories went on, and he divulged many details about his financial life as the line grew longer behind me. He was there to transfer money from his RMD, the required minimum distribution, from his IRA. He was heavily in stocks and quite excited about all his gains that allowed him to now consume in his retirement. He struck me as someone whose enthusiasm for the stock market was far greater than his aptitude in operating in the stock market. This was my shoe shine boy moment. I saw embodied in this old man the spirit of a hapless shoeshine boy whose entire fortune is resting on hopes of a greater fool to come along and buy his stock from him at a higher price. This was the moment my bearish inclination hardened into a firm resolve to short this market. The market breadth has been bothering me for some time, and I’ve been in about 75% cash for a while, but this short setup is too perfect to pass up so I’m reflecting my increased bearishness by shorting. I’ve been laying out my bearish case for over a month. Nothing I’ve seen has changed my mind, and it remains this: I think the 2026 market looks awfully similar to the 1987 and 1929 stock market crashes. We saw a summer rally, a break in late August, and now we are in the rally back up to the break level. All that remains is a failure to recapture the breakdown level, and then an October crash would complete the template. The signal I’ve been waiting for occurred Wednesday this week. The signal I wanted was a follow through day to the down side after a failure at the breakdown level. Tuesday, the Dow Jones Industrial Average got rejected at the $53K level on bank earnings. Wednesday is what I’m considering the follow through day. I’ve got a low risk stop right above the 50 day moving average which is 2% higher. A good crash could see a 20% down move so this risk to reward setup is too good to pass up. Here’s a pro tip, if you ever get a 10:1 odds payout, you take that trade every single time. I win on only 60% of my trades, so there’s a 40% chance I get stopped out of this trade at a loss. I’ve accepted the terms of the trade, and I’ll live with the consequences. This is a trade I like because I think I’ve got an edge here. That edge is my knowledge of historical precedent for a crash. I like to read old newspapers from the 1929 era to get a feel for the zeitgeist. Recently I’ve been reading the Financial Chronicle. One thing that stands out is how commonly accepted was the inevitability of a crash due to all the speculative excess that was occurring for two years leading up to the top. Back then, as will be this time, blame was placed on the Fed’s easy money policies. Back then, it was understood that the Fed’s credit creation was leading to all manner of unprofitable business venture that served no purpose (read the Oct 26, 1929 edition of the Financial Chronicle). Today we have crypto currencies, and there is untold amounts of time, talent, and treasure poured into this enterprise of dubious value. Nothing has changed in a century since the last big crash or since the South Sea collapse three centuries ago. Human nature remains the same today as it has been throughout all human history. We tend to over estimate the benefits of the future and look for ways to get rich quickly. This is what allows bubbles to form. Like all bubbles, this one too must eventually pop, and my view is that this one’s time has come. Of course the pundits will blame speculators when this bubble pops. But of course it’s not us speculators that cause the bubble. It’s policy makers that create the incentives for bubbles to inflate. This time around, with the Internet, there will be a permanent record (until it eventually gets scrubbed) of all the warnings since 2012 made by market participants that policy makers were setting us up for some terrible bubble to form that would eventually succumb to market forces and pop. The pin that pops this bubble could be a foreign central bank move. Either the Bank of Japan or the People’s Bank of China are likely culprits. The pin could also be an Anthropic IPO. This would suck up massive amounts of speculative capital and unleash tons of new shares into the market. The AI trade in general looks vulnerable with a topping pattern in the SMH. It looks like a double top to me. The last top at $630 also has an island with three days of isolated
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