How Much Longer Can This Last?

May 9, 2024

How's this messy market treating you?

Are you happy the market is a mess? Or do you find it frustrating?

Keep in mind, the S&P500 is still at the same price it was 2 months ago.

Both the Nasdaq100 and Dow Jones Industrial Average are still at the same prices they were back in February.

We're almost half way through May.

The Technology Index, which is the largest component of the S&P500 (30%) and has the largest weighting in the Nasdaq100 (50%), is still where it was back in January.

Again we're half way through May!

Meanwhile, don't forget about the Small-cap Russell2000 that's hilariously still stuck below where it was way back in December.

The Consumer Discretionary Index and Dow Jones Transportation Average are also down for the year.

That's the market we're in.

Some people keep pretending that this year is just like last year.

But I cheated. I actually looked at the data. So I know better.

And so we adjusted our approach several months ago, when this mess first got started, and have been much more focused on collecting income during this messy period.

Beauty is in the eye of the beholder.

What might seem frustrating to some investors, is a fantastic opportunity to collect income for those of us who are paying attention.

Names like Berkshire Hathaway, Nvidia and even some of the Gold Mining ETFs have all been great vehicles recently, and we discussed it all yesterday in our FREE LIVE Options Income Event.

Do you want to learn an easy to understand and easy to execute strategy to collect income during messy markets?

Click here to watch the replay of yesterday's LIVE event. I think you're going to love it.

Remember, there was once a time where I didn't know how to do this either. And now looking back on it, I feel like such a dummy.

I left so much money on the table over so many years.

But then I started working with Sean every day.

And I'm like a new man.

Instead of getting frustrated by these markets, I look forward to them!

And so how long can this messy environment for stocks continue?

I think this is the chart we want to watch: Treasury Bonds and Japanese Yen:

These are important assets.

One can argue, these are the 2 most important assets in the world - the US Treasury Bond Market and global relationships with the US Dollar.

If both of these continue to crash, as they've been doing all year, I can see this messy market for stocks continuing.

Remember how strong stocks were in Q4?

We had some of the most aggressive breadth and momentum thrusts in stock market history.

As you can see in the chart above, these lines were going up during that period.

It's when these lines turned around and began to fall, that stocks entered this much more messy regime.

As a reminder, if bond prices are falling, that means that interest rates are rising.

So can rates come down, meaning that bond prices rise, if the Yen is breaking down to new 30+ year lows?

My bet is no.

My bet is that these two continue to dance together, and it's up to the market to indicate that this relationship has changed.

To be clear, there is no evidence at all that Bonds and Yen are NOT moving together. In fact, they are moving tighter than we've seen in a long long time.

So expect this grind to continue...

Want to learn how to collect income from the guy who taught me?

Click here to give it a watch.

You won't be disappointed!