January 31, 2025
(SUMMARY OF JOHN’S JANUARY 29, 2025, WEBINAR)
January 31, 2025
Hello everyone
TITLE “Reality Calls”
TRADE ALERT PERFORMANCE
January 2025 MTD +3.02%
Average annualized return = +50.02% for 17 years
Trailing One Year Return = +82.88%
PORTFOLIO REVIEW
Risk On
(TSLA) 2/$300-$310 call spread (10%)
(NVDA) 2/$90-$95 call spread (10%)
(VST) 2/$100-$110 call spread (10%)
Risk Off
(TSLA) 2/$540-$550 spread (10%)
THE METHOD TO MY MADNESS
2025 rally gets cut in half.
Market has gone from non-risk to high-risk overnight, with the leading names, like (NVDA) taking the biggest hits.
All interest rate plays remain dead in the water, including gold, silver, homebuilders, bonds, and REITS.
Deregulation and end of antitrust plays will continue to be bought, including banks, brokers, money managers, but maybe not nuclear, and Tesla.
US dollar finally takes a break on falling rates.
Big technology stocks get crushed by Deep Seek, small ok.
Energy sells off on Deep Seek as well, no power is needed.
Buy financial as the only sure thing this year.
THE GLOBAL ECONOMY – COOLING
Fed stays put with interest rates. Fed Minutes are turning hawkish.
Consumer Price Index cools at 0.2% or 3.2% YOY, the first drop in six months.
25% tariffs on Mexico and Canada will raise the US inflation rate by 1.0%
US Consumer Confidence dives amid renewed concerns about the labor market and inflation.
2025 Economic forecasts are all over the map, as confusion reigns supreme over the impact of coming tariffs.
Credit Card delinquencies soar.
U.S. Business Activity slowed to a nine-month low.
The Tariff wars have started.
STOCKS – PUNCH TO THE NOSE
Technology stocks destroyed on news of China’s Deep Seek.
Nvidia drops $600 billion in market capitalization, the largest in stock market history.
Morgan Stanley warns customers to cut stock exposure.
The Cruise business is rocketing, with Royal Caribbean (RCL), just running up its best five-week sales period in history.
JetBlue (JBLU) gets destroyed, knocking 25% off of the stock.
Lockheed Martin (LMT) dives 8% on a cautious outlook spurred by our new government.
EV and Hybrid Sales reach a record 20% of US vehicle sales in 2024.
BONDS – STABILIZING
Bonds have stalled near two-year lows, yields down to 4.53%
All fixed-income plays have gone dead.
“Higher Rates for longer” don’t fit in here anywhere. But there may be a BUY setting up for (TLT) at 5.0%.
Bond yields have rocketed 130 basis points since September.
National Debt tops record $36 trillion and could rise another $10 trillion.
TIPS are making a comeback.
FOREIGN CURRENCIES – FINALLY A WEAK US DOLLAR WEEK
Dollar backs off two-year high on interest rate pull back.
Ten-year US Treasuries have risen from 3.55% to 4.80%, then 4.53%.
The mere fact that rates have stalled has allowed currencies to rally.
Higher for longer interest rates mean higher for longer US dollar.
Don’t sell short the US dollar until the next recession is on the horizon.
Avoid (FXA), (FXE), (FXB), (FXC), and (FXY).
ENERGY & COMMODITIES
Deep Seek shock trashes all nuclear energy plays on fears that the new orders will be cancelled, as the extra power will no longer be needed.
New AI programming uses 1% of the chips, and therefore 1% of the power.
Nothing could be further from the truth. Buy all nuclear plays on this dip.
Ban lifted on new natural gas export facilities in 4 years, reversing a climate era climate initiative.
Many analysts expect an oversupplied oil market this year after demand growth slowed sharply in 2024 in the top consuming nations: the U.S. and China.
The EIA said it expects Brent Crude oil prices to fall 8% to average $74 a barrel in 2025, then fall further to $66 a barrel in 2026.
PRECIOUS METALS – STRUGGLING TO RECOVER
Gold has recovered half of the post-election losses on the central bank and Chinese flight to safety buying.
Interest rates higher for longer is a death knell for precious metals, with gold down 8.3% after November 5.
Gold has become the only way the average Chinese can save as they can no longer speculate in real estate or copper and don’t trust the Chinese Yuan, so there is support lower down.
Central banks in emerging market countries are continuing to buy gold, with 693 metric tonnes of buying, or $5.3 billion this year.
Avoid (GLD), (SLV), (AGQ), and (WPM)
REAL ESTATE – POOR OUTLOOK
Single Family Home starts plunged 6.9% in October.
Home Insurance costs are soaring for homeowners in the most affected regions, California and Florida.
U.S. Home Sales hit a 30-year low in 2024, the second year in a row of weak sales.
Housing starts were up 3.0% in December, with single-family homes up only 3%, while multifamily saw a 59% rise.
Shift away from home sales – crushed by 7.2% mortgage rates.
You can write off real estate in 2025.
TRADE SHEET
Stocks – buy the next big dip
Bonds – sell rallies
Commodities – stand aside
Currencies – stand aside
Precious Metals – stand aside
Energy – buy nuclear dips
Volatility – sell over $30
Real Estate – stand aside
NEXT STRATEGY WEBINAR
12:00 EST Wednesday, February 12, 2025, from Incline Village, NV.
Jacquie’s Post Portfolio Update
We are going to take some profits.
SELL
Equinix (EQIX)
Purchased on February 21, 2024, at $900.00
Price on January 30th, 2025, = $922.13.
Sell and take profits today at the best price.
Jacquie’s Post January Zoom Meeting
Thank you to all those who attended the meeting yesterday. It was great to see you all there. See you next month.
Cheers
Jacquie