How To Trade Critical Moment For Market As Indexes Shoot Higher: Jim Roppel — Monthly Market Report

[00:00:00] Speaker ?: *music* *music* [00:00:36] Alyssa Coram: Hey everyone, and welcome to Monthly Market Report. It's Alyssa Coram and Jim Ropal here of the Ropal Report. Jim, it's always great to see you. [00:00:46] Jim Ropal: Great to see you. We have a lot to talk about. [00:00:49] Alyssa Coram: Oh yeah, we do. Three days up in a row off the lows. A pretty big day in the market today. And a lot of devastation in recent weeks amongst all the winners. So where does that leave us now? Jim, we have you here to provide that clarity for us. So we're looking forward to picking your brain. I'm speaking on behalf of our community when I say we. Looking forward to picking your brain. [00:01:16] Jim Ropal: Well, in the comments for this promo thing, a dude named @stockstockandwhatever put the most double great kick-ass golden goose up there. And that's exactly how I feel. We need to do a market temperature check right now. What do you think? Let's do it. [00:01:32] Alyssa Coram: Let's get right into it. Okay, pull it up. [00:01:34] Jim Ropal: Let's see here. Okay. Can you look at... Well, let me know when you pull it up. The bull bear? [00:01:40] Alyssa Coram: No. [00:01:41] Jim Ropal: The market surge. Okay. [00:01:44] Alyssa Coram: Oh, you want to look at the indexes first. Yes, please. All right. Yep. [00:01:49] Jim Ropal: Let's go. Okay. [00:01:51] Alyssa Coram: Diamonds. Okay. [00:01:53] Speaker ?: Yeah. Okay. [00:01:55] Jim Ropal: All-time new high close. Okay. I just... Right there. Full stop. Let's put it back in gear and look at IWM. [00:02:03] Alyssa Coram: Yeah. That looked great today too. Okay. [00:02:06] Jim Ropal: What is it? 2% off the all-time high? [00:02:08] Alyssa Coram: Very trend line. Mm-hmm. [00:02:11] Jim Ropal: Okay. MDY. [00:02:13] Alyssa Coram: Also a nice gain. [00:02:18] Jim Ropal: Look at XHS. This is one of the best patterns sector-wise in the whole market. [00:02:23] Alyssa Coram: Okay. Healthcare services. Oh yeah. That's a great run up and orderly pull back here. [00:02:28] Jim Ropal: Super orderly after a big semi... It's clearly a prior uptrend. You could almost call it a flag. Pull. And then look at please CSX, please. [00:02:44] Alyssa Coram: Okay. Mm-hmm. [00:02:46] Jim Ropal: Alex Trebek. Question. Golden Goose says America's shipping goods all across the country in mass. Rail car loadings record high. You know... [00:02:56] Alyssa Coram: Yeah, look at that weekly. [00:02:57] Jim Ropal: The world primarily travels on digital rails and that's why semiconductors are so critical. We'll talk about that last, but there's... Undenying it, the hard goods are moving across the country. Please look at XLF. [00:03:12] Alyssa Coram: Yep. Financials. [00:03:14] Jim Ropal: And then like there's the Mac Daddy and then there's El Jefe. Mac Daddy would be JP Morgan. [00:03:19] Alyssa Coram: And then El Jefe is NVIDIA. [00:03:20] Speaker ?: Okay. Like is NVIDIA robust? [00:03:22] Jim Ropal: No, but it came ripping off of almost a little trap on the bottom. It's... It is not up. It's not down. It's been sideways for a long time, but it's not in trouble. Now, look at banks, please. KBE. Outperformance over the last couple of months. Okay. [00:03:43] Speaker ?: Where... What? No, you look at Bear Bowl. [00:03:46] Alyssa Coram: We have 42.1% bears. What? [00:03:48] Jim Ropal: I mean, like is everybody in the world in memory and optics? Like, I mean, the rest of the market looks fantastic. I mean, it looks... It would be hard to come up with a better move for the broad market. Now, again, I don't necessarily own the broad market. I'm in a high growth area, you know, high earnings growth area. So let's... I'll have to look at everything. If you look at DRAM or SMH. Right. They clearly... Those sectors would need a follow through day. But the broad market does not. And I don't get it. How could we have 42.1% bears in 31 bulls? With everything basically within spitting distance of an all-time new high. Or a full-blown all-time new high. The golden goose is rocking. Is it a time that you can crush it in high growth names? Not at this second. Because we just had a pullback in NASDAQ of like 9%, 10%. Which... It just seems like there's an awful lot of hand-wringing over something that happens in tech stocks like four times a year. The average... Okay, I might be a little off on this. But I... My aged memory. But I think we need to... The average market, average year has 4.1 follow through days a year. So this is like super garden... Absolutely garden variety. And people are walking around like they've lost their minds. And I just... I'm like, if you can't take a pullback like that, you shouldn't be in the market. You should be in T-bills. Okay. [00:05:36] Alyssa Coram: Yeah, exactly. And I think unpacking that a little bit more, you have a stock, you know, a lot of growth traders that were in, including myself, this Sandisk here, riding high from that March to early June timeframe here. And even with a little bit of a snapback, Jim, it's still 45% off the highs. So perhaps a lot of traders using leverage or... And we'll get into that piece of it too. Or oversized positions and not managing risk and not looking at the technical action, just relying on either the fundamentals or the story. And seeing devastation in their portfolios, not hedging. Like I know you like to hedge or use that guardrail, the 50-day line. And I think, you know, some traders out there were trying to give this one a little bit of room, a little bit of patience. I was trimming before it went below the guardrail and tried to give it a little bit of room. But, you know, just traders out there who had too big of positions and they're holding this all the way down. I think that's where some of the issue lies. For sure. [00:06:56] Jim Ropal: Correct. 100%. You mentioned the guardrail. It must be honored. It's just a zero defect policy. But Sandisk went from 40 to 23, 4, 500. [00:07:10] Alyssa Coram: Yeah. [00:07:11] Jim Ropal: It's completely 100%. It's earned it. It's like the military veteran who saved 140 lives, did three combat tours. He gets to go home and chill. I mean, this has been the greatest stock. And I've been a trader for 40 years. It's of all the liquid names. There's never been a stock like this in my life. Now, there's been stocks that have had longer, bigger moves over longer periods. But like Cisco, everyone goes Cisco. Cisco had multiple 40, 50% pullbacks and went on to greater things. Now, we'll... By the way, Cisco right now looks like somewhat of a double bottom. And I don't love the wedginess up under the 50 and it's not a high growth name. But if it comes out over the two lower pivots, I'd have to say analyst estimates are quite low. So I'm totally tangential. But you're right. Sandisk... [00:08:18] Alyssa Coram: Listen. And stocks like it. The whole memory space that you mentioned. [00:08:22] Jim Ropal: It's hard. [00:08:23] Alyssa Coram: The NBISs of the world, which is snapping back. [00:08:28] Jim Ropal: Sandisk was also tricky because it had a couple of climax runs, which by all historical standards, it's just like there's very few stocks that have multiple of them. And then it went on again. So it kind of trained people to be a bit complacent. But there's no excuse below the 50. Either it's a trim, a hedge or a sell. And if Bill was here, he'd say, well, why didn't you sell some into the climactic action? Right. I mean, the market has been uniquely robust. And the pullback in the memory and optics, 100% completely entitled to it. I personally was slow to recognize it like many. And did I pull back too much? Absolutely. Absolutely. And I think there's a lot of people who have been hit really, really hard. And because they were so over-concentrated, like you said. Yeah. If that's the case, the remedy is go through. Review all your stock trades in the last six or nine months. If you're down too much, you've made mistakes, own them. Self-responsibility. Figure out why you didn't sell at the guardrail. Why didn't you sell into the climax? And then review it. And guess what? It's totally chill. If I'm anywhere near close to correct. Oh, my McKenzie chart's over here. McKenzie says that the AI- [00:09:54] Alyssa Coram: The 80-year cycle? [00:09:56] Jim Ropal: 2070. [00:09:57] Alyssa Coram: Yeah. [00:09:58] Jim Ropal: Okay. Okay. Now, that's a heck of a lot of runway. And I believe, listen, when you have the biggest innovation in history, the most dramatic impact on society, you have to expect the most dramatic impact on percentage up, percentage down. And because McKenzie says 2070 or 60, I'm not sure what it is exactly, but that doesn't stop asteroids from rolling into our universe. Okay. They're going to occur. In the internet build out, we had a global currency crisis in '98. There's going to be multiple of those. There will be wars. There will be bear markets and there will be many big bear markets along the way, but all right, I'll chill. [00:10:38] Alyssa Coram: Well, we have a lot more to get to you with you, Jim, including we have a lot of attention that has been put on the AI trade with this situational awareness hedge fund, Leopold Ashenberger. I want to get your take on that. When we did see that snapback in the market starting late last week, pre-market was when the news was making the rounds that Citadel, or at that time, I don't think we even knew it was Citadel yet, had bought the entire public book. So how does that dynamic play into the whole AI trade here? [00:11:24] Jim Ropal: Almost every bull cycle I've ever been in has seen blow ups. Now the difference is this was a larger blow up and it was, well, first of all, it's cleansing. It's cleansed the market like the Caspi down 40% in 44 days of 1.2 million Korean accounts margin calls. 3.2% of every account in Korea was not margin called, but wiped out. Back to Leo. Look, I know him. I never talked to him. But this kid is brilliant. Did he make a mistake? Absolutely. He's 24. When I was 24, I blew my account up four times and I'm a fraction as smart as he is. And I've come way back. I will bet anything. He will become one of the most prolific hedge fund majors in history. All these guys dunking at him are going to look bad down the road. He will come back. He's learned a lesson. Like I learned my lesson and he's way smarter than me. And he's, he's got a bigger following and he's got more attraction. This guy's going to become an absolute monster. I don't think he's a niederhoffer. Okay. I don't think he's a blow up artist. I think he's just young at 61. I can call him young. He's going to be back. And it also says, because you are right on fundamentals doesn't mean you can make money in the short term. He's probably very right. He's, he's learned. He still has capital. I would give him money. Absolutely. And I think a lot of other people are really kind of waiting to give him money. So pro Leo. There you go. Yeah. [00:13:03] Alyssa Coram: That's such a great point that I think individual investors can take too is the conviction, the thesis, but also the risk management piece. Right. [00:13:17] Jim Ropal: It's the game. It's position size. Yeah. Let, let four X, no need, no need. Uh, again, he achieved returns like almost no one else. And I think everyone's jealous of them, especially guys in my seat, you know, other hedge fund dudes. I mean, I'm doing, I'm having a very good year. I'm not up. Whatever. He says he's up 80% something like that. He's going to have to dial it back and he's gonna have to learn some lessons, but this kid. Leo, call me. Okay. Give me some money. [00:13:49] Alyssa Coram: There you go. I like it. Okay. So one more, at least for now, AI related question, Jim. And that is, you do see this tendency out there with some investors who want to buy stocks on the cheap. Right. Uh, you know, XYZ stock has, you know, has a great story. It's come down a lot. Now this is the time to get in. How do you balance that sort of thinking that you hear out there with looking for quality setups? There's such thing as a quality company, maybe needing more time, right? Just patience. Is that what you would advise here? [00:14:33] Jim Ropal: At this minute, there's about five stocks I see that have accelerating everything. Great fundamental stories like Datadog tried to come out. Now again, Datadog doesn't quite have the high octane horsepower. It has great stability, high, high 20% metrics, but it was lethargic today. And maybe we need a follow through day in high growth tech, but I do love the solution they have for over usage of tokens. And it's kind of like a bugaboo that the bears are all talking about. They're, they have a great, well, they've had a historically great 99 comp, wonderful metrics. But this is a new product. The N in CanSlim, but it couldn't get out. It couldn't attract that additional power to really get it out of there. So it's time to chill for a minute, but there's a lot. Okay. I want to answer your question. What about all the stocks that have great numbers, but they're, they're way below pivots. They're way, and there's a lot of double bottom setting up. It's not time until the price validates your fundamental or belief. So it's time to chill and we may have to chill for a good bit of time. Again, the formula that's made me many years, great years where I have a big quarter, Q1, Q2, maybe rough in Q3. I have to back off, keep my mental capital intact and my, my real capital. And then Q4 comes along and, and, and off we go. You know, if you're up 20, 30, 40, 50% this year, or even 15, you could double that in Q4 and have a, like a, you know, how many? How many 30, 40% years do you need? And that's totally plausible here. The, the historic recipe for a big year is totally in play for most people. Some people, and I know some professionals they're down 20, 10, 15%. It completely can be recovered here. The goose is real. [00:16:31] Alyssa Coram: There you go. And, and so next linear, just kind of another example of one of these stocks where you see that accelerated growth had the explosive move. But it's not actionable. What's the market? At these levels. What's the market temp? Cap. Oh, market cap here. 6 billion. Okay. [00:16:52] Jim Ropal: That's in the zone. I mean, I don't, for some reason, this stock just looks rickety to me. It came out of nowhere from nearly almost a penny stock. But if you look at like an SIMO, they make timing chips or, or is it SITM? Both of them. They have rapidly, rapidly accelerating triple digit earnings. Uh, these are some, maybe to the IBD faction. This is a somewhat known or understood name, but wall street, just, they don't know what these are. Um, now look, that, that looks like a wicked, wicked downtrend. And it is, but there's a double bottom in place. And people are like, well, how could it get all the way up to the pivot so quickly? Well, look at Google. Right. You know, Google has, um, one of the biggest floats in the world and it got up off its knees and it's sitting right at a pivot. If, if Google can, if wall street can generate the horsepower, the money to turn the wheels, to get this thing up right to a pivot in what? Seven days. Uh, SITM could be hoisted up there in minutes. [00:17:58] Speaker ?: Yeah. [00:17:58] Alyssa Coram: That's, that's a really good point. So what do you make of all of these mega caps coming back? And, uh, I guess this is another AI related question because you're seeing, uh, a lot in the most recent earnings reports, great earnings, but a huge cash burn related to all the AI spend. So, but I mean, these stocks are really making a comeback right now. Amazon, Microsoft, uh, meta still looks weak, but it too is bouncing back. [00:18:29] Jim Ropal: How do I say this? I saw bill pub speak publicly for free 30 years ago. And he's like, Cisco has absolutely topped like emphatically. And I wasn't really communicating with a lot then. And, and out of the blue, I got to speak with them about a month or two later to come back in Cisco. These names look deathly ill. You don't know. They broke the 50. They turned down. They, they've, they're starting to recover. Like the, the, they have cycles and some of these stocks have not nine lives, but 15. Um, you just, you have to go with it. You can't, when the whole market breaks the 50, you don't know is a bear market at foot, but you have to take heed. If it comes back and, and there's corroborating evidence like transport transports and the rails moving, you reassess and you go, you flow, you know, you have to flow with the tide in and out. And the, the big mega caps, uh, the, the, the market believes, and that's all you need to know. The market did not believe I've IGV still does not look wonderful at all. Uh, but the market's mysterious and it's unpredictable. I'm not a pro I don't predict the future. Um, I just follow that trend. And when they turn, what do I think about the mega caps? I think they've turned up in several cases and that's looking mags, mags came out of the, out of, out of the coffin today. [00:20:01] Alyssa Coram: It did. Uh, and I, I will share, I shared this on IBD live. I did pick up a little bit today because I didn't think that a lot of the mega caps were in ideal positions individually to be bought, but I wanted to get some exposure here. So, uh, doing it via the mags. Uh, Jim, how are you positioned here? I know you said for the NASDAQ, you're waiting on, on a follow through day. We're right up to that 50 day, the 26,000 level. Um, we're not all too far from that previous marked high. So if we can get a little bit more momentum here, I think that also would be looking quite compelling. You mentioned all of these other areas, whether it's the Dow, the mid caps, the small caps, uh, RSP. We haven't even looked at the S and P 500 and like, look at that. [00:20:58] Jim Ropal: Look at that. I mean, that is, that, that, if that was an individual. It's a Mona Lisa. Isn't it the duration of a Mona Lisa, but it looks incredibly powerful. Yeah. [00:21:11] Speaker ?: Good words. [00:21:11] Jim Ropal: Incredibly powerful. And we have 42% bears. Like there's going to be, okay. So all my subscribers, you know, I, sometimes I'll say, how much cash do you have? And most people, I think in, there's a huge amount of cash on the sidelines and that's when markets bottom. Now this goes through the top and there's among people who are trend followers, intermediate term trend followers. If they're 50, 80% in cash and that makes a new high, that could, could kick off some type of stampede. Now we're not in the seasonality for that. Okay. Everyone's all the big dogs are out in the Hamptons, you know, their boats and planned the bridge. So maybe it'll be us little guys, you know, who are grinding out in the world. But if that comes through and there's a ton of cash on the sidelines, people are going to chase. And that S&P looks spectacular. That today's move is just like, I think about all the time, what would Bill do? And Bill would say, well, a move like that, you've got to act. So, I mean, we haven't had, you don't need a follow through day on the S&P. Yeah. You need a follow through day on Russell. You just need some, some breakouts, which we haven't quite seen yet. I mean, Amazon was kind of a breakaway, like you talked about, like a super. [00:22:32] Alyssa Coram: Yeah. [00:22:33] Jim Ropal: Again, when you discuss, I mean, to move a float that large, that's, that's mega horsepower. That's mega buying. [00:22:43] Alyssa Coram: Yeah. [00:22:44] Jim Ropal: I mean, you put that kind of buying power into an SITM. It's going to go up a thousand points. Yeah. [00:22:51] Alyssa Coram: Pretty impressive here. And you, you're seeing the fundamentals accelerate along with it. So I think in terms of our style of trading, you know, we really like seeing the, the up and growth. So will this be one of the new mega leaders? We'll have to see, but an interesting move over this two day period, no doubt for Amazon. I want to know a little bit more about how you're positioned here, Jim, with a lot of the leadership from the April, May timeframe, largely now out of favor. Where, where are you seeing the leadership today? [00:23:31] Jim Ropal: I'll, I'll say I'm very heavy in biotech and I'm, I'm getting swamped in Lily. Um, but, uh, XIB, XBI to me, well, Lily's got earnings before the open on Wednesday. Yeah. So I'm going to have to hedge that. Okay. Earnings season in general has been terrible. Uh, but you said Amazon, I'm, I'm reverting back. I wanted to say this. Okay. Amazon has a unique history of when earnings season has started off crummy. All of a sudden Amazon has come out before. Like I was almost all in cash a decade or so ago. And, uh, we had a bad early start to earnings season and it just comes ripping out. And it, it kind of changed the tone of the whole season. And immediately because of Amazon, I just started buying everything that came out after that. Cause, but other stocks came out in the coming days and weeks and corroborated it back to where I am. I am, I am heavily in biotech. I have net a lot of cash. I'm really just super hedged. I'm not really, I have, I have some raw cash, but mostly hedged positions. And I'm patient. I'm waiting. I do not have, if this thing doesn't break out, if it rolls over, I'm just fine. I'm just chill. I can wait. We've had a spectacular start to the year. I think the normal recipe for a monster year is in play. The technology is there to give us the opportunity. The cash levels are high. The speculations largely been rung out. And I just think we need a little more spark on this somewhat dry tender. Mm-hmm. [00:25:14] Alyssa Coram: And so let's talk about some stocks you mentioned, Lily. This is something that I own as well and trimmed a little bit today. Didn't like the outside day downside reversal with the broad market moving with how it moved. So yeah, I either hedge or exiting heading into the earnings depending on how the next day goes really. But your thoughts on exactly how you would hedge this, Jim, heading into the earnings. [00:25:44] Jim Ropal: I will almost certainly be buying a bare put spread. I'll probably look for a close to a delta neutral put, and then I'll sell a put way lower to cover part of the cost of the higher level put. But these guys have a court case going. They have -- there's multiple issues that they're kind of out of their control, and the market's a little soft on this. The fundamentals to me are spectacular, but I cannot not cut my losses. Yeah. So I love it, but a lot of stocks I've loved recently have not worked. I was a massive circle bull. That blew up. But, you know, look, the time is just not at foot, but I believe that there will be more AI agents than humans, and I don't think it's going to take 20 years. I think it's going to take -- by the rate of adoption, it's going to be much faster. Circle has the number one stable coin usage on by agents, but the market totally disagrees right now. There's a ton of competition, not for agentic use of coin, but I'm -- you know, it seems like there's no chance that -- is it 140, the first pivot? [00:27:05] Alyssa Coram: 140 right here? [00:27:07] Jim Ropal: Yes. [00:27:08] Alyssa Coram: Let's see. He said 136. [00:27:10] Jim Ropal: Okay. And the stock's trading at 60? [00:27:13] Alyssa Coram: Yeah. [00:27:14] Jim Ropal: Guess what? Some good news, and this thing could roar up their -- I mean, people totally underestimate what's possible in short periods. I always say bear trends and bull trends can emerge in three days. It's the same thing can happen if they have -- they report earnings Wednesday morning, too, I think. If they come out and say, who knows what they could say? I'm not saying it's going to crack that number, but at some point, I do believe it may -- I believe the odds are higher that it will eventually, but it completely disagrees with me right now. And Lily, I love, love Lily, but it's not in gear at this minute. It's a little soggy. It's taking water over the side of the boat. [00:28:00] Alyssa Coram: It is. And Jim, you mentioned Datadog and, you know, looking at some of the nuances with today's bar, right? And I guess even Friday's bar. What are your thoughts on Snowflake? This is also in the software sector, and I think it's interesting how, just broadly speaking, in terms of the AI thesis, it wasn't too long ago where it's like, all right, AI's killed software. Software's dead. Now it seems like there's a shift in the AI thesis when it comes to software and when it comes to the hardware and data center built out. And you've talked about these sort of ebbs and flows, these waves that you'll get within the broader cycle. [00:28:48] Jim Ropal: Okay. There hasn't been a lot of volume. It could use more volume as it emerged over the recent highs, but it is acting -- price trumps volume by, you know, 45, 55. It's like the rotation. When aggressive memory, optics, AI names started to roll over, the money went into biotech. And now all of a sudden those names have caught a little lift and biotech's kind of rolled over a little bit. You have to have conviction. If you're jumping all over the place like a fish, you're going to get butchered. I just think you have to have -- well, again, with cushion. Cushion is wildly, wildly undervalued, underrated. Even Bill didn't really -- Bill would say you play against your cushion. But when he would speak, he -- I don't think he gave enough attention -- me telling Bill what to do. I wish he would have said more about it because it allows you to sit through some rotation. Now, if you're overweighted, Leo, you're going to have some problems. But I wish it had more volume. I do think that the lack of horsepower coming up might be due a little bit to the summer doldrums or people don't -- or it's super early. I'm not sure. Without the volume, if it doesn't work, it's not like, oh, gee, how did that happen? Now, if it -- it can still gain strength and keep going. Like, Victoria's Secret, it's just kind of -- it's lethargic at all-time highs. It's acting -- it's at all-time highs, but it is not robust. The move off the lows like a month or two ago, it had this fantastic up move, and now it's just subtly advancing. It's not rocking. So I think the fundamentals here are spectacular. And the market loves this name. It just isn't pouring money into it at this second. But if you don't have patience, you may never see the next leg. [00:30:51] Alyssa Coram: So speaking of that patience, what's a stock that you have a big cushion in that you have hedged, that you're still sticking with, and it needs a little bit more love from the market? [00:31:08] Jim Ropal: How about half my portfolio? Insight. Well, I don't even have that big of a cushion. I'm really -- I've really -- the names I'm having that I have heavily, heavily hedged are very, very damaged. Okay? So I'm just kind of waiting it out, giving them a little more time. And it's critical to know. I think I talk a lot about hedging. Hedging hits the pause button on tax long-term gains seasoning. So I'm well aware, but I am going to give these names a little bit more time. And so I don't have anything that's, like, ruddy to rock at this minute. I have biotech to pull back. [00:31:51] Alyssa Coram: Yeah. Well, I think even some of the ones that are out of favor at the moment that you have big cushions on, it's just instructive to know, okay, when should you be patient with a hedge? Or when should you ultimately throw in the towel? Is it a certain, you know, move off the highs? Is it an undercut of a longer-term moving average? Is it the relative strength rolling over a certain amount? You know, or is it sort of, you know, some of your friends, Eve, and her fellow co-authors, the mental capital preservation element? How do you think about that? [00:32:34] Jim Ropal: I think that below the 50-day, you have to get out in one way or another. I'm holding many names that are well below the 50, but I don't have a capital, I have a capital surplus. Now, if I see names roaring out, and I need capital, and I don't want to pay margin balance, I'll liquidate that. I'll rotate. But right now, I don't have a capital problem. I have a surplus of capital. It's kind of like if you have a trough, and there's 10 pigs in it, and it's full, and a new pig wants to get it, he's got to push one out. You know, Bill would say, he never said that. Bill said, "Weed the garden." Well, I'm giving these names more time because I know history, and I know they do pull back 30%, 40%, 50% regularly. Look at the first 100 pages of the most recent book. I'm willing to sit through some, I'm totally hedged. I will not dislodge these names until I need the money. [00:33:31] Alyssa Coram: Okay. So, what about folks out there who want to buy these now? Who want to buy? [00:33:38] Jim Ropal: Yeah. [00:33:39] Alyssa Coram: Patience. [00:33:40] Jim Ropal: I don't think, if Datadog can't go, we need some of these, like Google could be the beginning. Like, you could start with a Google if it comes out, and you have to say, "Look, it's a trillion-dollar market, or how many trillion is it?" I don't know. Yeah. By the way, that looks really good. If that comes out, you can put some money to work there, maybe buy the Qs and see how that works, and see if some of these more high-octane names can jump out. But I don't see, I see a lot of fundamental metrics that look spectacular, but the technicals need to line up. We need a couple more, we need a couple non-recovery bounce-type stocks to go, and we need the flock to expand to some new names. Yeah. [00:34:28] Alyssa Coram: So we kicked off the episode talking about, you know, whether it was the Dow, mid-caps, small-caps, I mean, the S&P, the transports, we looked at some of these other areas, financials, all healthcare services. Do you think we should be looking at ETFs then? You mentioned the Qs for exposure. So is that what you would be looking for now, with the leadership in individual stocks, either unclear or out of position? [00:35:01] Jim Ropal: Yes. I think that the can-slim practitioners red-hot market is not at foot at this minute, but it's not unthinkable we could get a follow-through date tomorrow, or in the next 10 days, and that new names could emerge. But at this minute, it's not in gear. It's not, it's not, I have a hedge fund manager's call. I talked to these guys a couple, I have a couple of them. Anyway, a question we always ask is, can you make money right now? Well, you can, and maybe if you're patient in the indexes or some of these other names, but the traditional, you know, can-slim names are not making us money today. That can change in seconds. If you look at like, again, this is a tiny little name, but BLLN, Cloudflare, Net is, again, that base in Net is really erratic, like super erratic. But that's an AI agentic beneficiary. ASML has a double bottom. Hinge, now this is a flea of fleas almost. It's the first pullback to the 50. Amazon hit a super gap. I mean, if you really needed exposure, you could have bought that today. CrowdStrike is trying to move up. Yeah. Ntap is a, like what, $60, $80 billion market cap with low earnings growth is trying to come out. I mean, like, that could be a, like a turnaround, like HPE, Hewlett Packard. These are not high, high horsepower names. Like I love ASX. Again, don't throw fish at me, but like STX is not a million miles below the 50. It's held up fairly well. [00:36:45] Alyssa Coram: Yeah. How's AMD doing? Let's see. Yeah. Well, AMD, Dell, back above the 50, had a pretty good day. [00:36:54] Jim Ropal: Yeah. They are like totally in the ballpark. Like you should be looking at them. But I was stopped out of that like two weeks ago. And then another person who for the manager works for me got stopped out the other day. I think we might've been forcing it because the wide high to low in there, that was another signal the market was toppy. We had a lot of insane vol in these names. And I tweeted out once, I said, when the volatility gets like this, and honestly, it's not like this, it's unprecedented. Stocks are moving. I mean, like almost every single day, there's stocks 15%, 20% moving. That's not normal. So I do, again, you heard me say, dramatic, historic technological innovation is going to result in dramatic moves in stocks. I think we're in a new regime here. I don't believe, you said it. You said something earlier and you said, AI, this is another AI situation. Everything's AI. Right. The world is moving, but it's all moving to the beat of AI. It's a, it's such a, so the vol in arm, the vol in AMD, the vol in a lot of these stocks we've talked about is just, I would, I would like him to tighten up, but I'm not sure we're going to see it. And the solution is let one of them go out, like see if it goes and if it can hold, but mostly I will not chase a stock like that. I will have to see if the market's going to tolerate it. And that's yet to be seen. There's a lot of words. [00:38:39] Alyssa Coram: No. And then if you do, we love the words. And if you do see the market tolerate it, then what would be your next move? Okay. These types of stocks with this type of personality are working. How does, how do you manage risk then with position size? [00:38:58] Jim Ropal: Cause I know position size is key for you. I would go after the next one in smaller size, but it's like this out of a bear market. How far will the market let the NASDAQ extend over the 50 day? Well, if it's only six or 7%, you know, that that's what it'll allow at that minute. All of a sudden, if it extends to 15%, now you can say, well, next time it gets up to 7, 8, 9, I'll see if it can go to 15 before I get too defensive. You have to say, what will the market allow? Yeah. When does gravity, when does the market bring gravity into play? It's my, that's a best guess. I just wing that off the coffin. Yeah, I love that. [00:39:38] Alyssa Coram: All right. That sounds great, Jim. Okay. Moving on. I know you are focused on the lockup ending for SpaceX. Do you have updated thoughts on this one? [00:39:55] Jim Ropal: You know, I, occasionally I get it right. And I said, no base, no, no ring, no bring. And this thing just, it just never gave you a real legit chance to get involved with it. And I remember John Templeton in 2000, he said, well, you know, he gave every, every student in Georgia who wrote him an essay on why they should go to college, a free college education. And he used the money he made shorting internet stocks after the lockups came. And he said, well, I think that's a great deal. And he said, well, I think that's a great deal. And he said, well, I think that's a great deal. And he said, well, I think that's a great deal. And he said, well, I think that's a great deal. And he said, well, I think that's a great deal. And he said, well, I think that's a great deal. And he said, well, I think that's a great deal. And he said, well, I think that's a great deal. You know, a massive amount, but it would, if these stocks that are super volatile and loose break out, it will signal greater froth. Maybe the market could be deeper into this cycle, this wave within this mega super cycle than I think. And we'll see how these tranches of unlock get absorbed by the market. But a lot of it's probably already taken into consideration looking at what it's done. [00:41:07] Alyssa Coram: Yeah. This did not stick the landing there, at least as of yet. All right, Jim, when it comes to finding the next batch of leaders, I think that's what a lot of folks look to you for. And you rattled off a number of names that you're watching. But remind the audience of what you're really looking for from a fundamental and technical perspective. You love liquidity. I do. You love high growth. Anything else in particular as we're screening, looking for those diamonds in the rough that we should be thinking about right now. [00:41:46] Jim Ropal: If you could pull up SITM. Now, here's the thing. That thing just doesn't trade. It sometimes trades 300,000 shares a day. If you pull up sales, earnings growth, triple digit, 99 comp, margins expanding. Management has a huge position. It's just not. You need to throw a zero on the volume. Again, the market. I can't see your screen, but what's the market cap on that? 14 billion. [00:42:11] Alyssa Coram: 14 billion. Okay. [00:42:13] Jim Ropal: That is the bottom end, middle of mid cap. That is usually where liquidity comes in. And above 9 billion to 12, 13, 14, 15. If you can catch a name in there that's liquid, they've overcome a lot of pitfalls. Most IPOs never do anything. Most of them are not profitable. They're junk. They never get through the hurdles. You get up to 10 billion, 12, 13 billion. You've overcome a lot. And you're profitable. Now, all of a sudden, you might be in the position to go to the bottom of large cap. I love that market cap with liquidity, with numbers like this. ASX has great numbers. It's clearly not in gear at this minute. I'd look for stocks like that, but they are just not. Look, we're so early here. If this thing's going to, if growth, the high octane material that we're looking for gets in gear, there's no need to run here. Yeah. But God, that excites me. Google fires me up. I'm looking for names like those ones I just rambled off. [00:43:19] Alyssa Coram: There you go. [00:43:20] Jim Ropal: They're never going to have alphabet liquidity. What an anomaly Google is to have the type of sales and earnings growth with that market mega cap. I mean, this just speaks to the revolutionary situation with fundamentals globally in AI, where NVIDIA can run at these whacked out growth rates with this type of mega cap. Yeah. The world's never seen it. Yes. And the world's never seen anything like AI. Mm-hmm. [00:43:49] Alyssa Coram: Yeah. And Amazon had a huge quarter earnings-wise too. Yes. That triple-digit growth there. We're just in this. Kind of out of nowhere. [00:43:58] Jim Ropal: We're in this crazy, crazy moment. And I don't think it's a moment. I think it's going to be a decade or more. And we're so early. People are calling for the top and it's overvalued. And every bear in the world, every Jim Chanos is just screaming from the rooftops. And they're like, I don't understand how they don't understand history. Maybe I don't understand. I just buy the new highs. [00:44:21] Alyssa Coram: But it's good to have bears, right? If you want the bull trend to continue. [00:44:30] Jim Ropal: You need bears and you need pullbacks and corrections. [00:44:32] Alyssa Coram: And pullbacks and corrections and cash on the sidelines. [00:44:35] Jim Ropal: And we have a lot of pieces in place. We've had a ringing out of excess. We've got Chi cash. We had a blow up, a major blow up. Not, you know, usually funds that blow up are, you know, 400, 500 million, a billion or two, not 24 billion. This is great stuff. And that chart right there, we could be at the beginning. We're going to see the blue chip go first. The quality institutions might be timid here. So they're not going to buy some of those high octane names I've looked at. They're going to wait and see if the big dogs, the blue chippers like Google and the net index can stick the landing. They'll get a little more confidence, a little more bold. They've been stung in the memory. And if that holds, I don't think we're quite ready on seasonal. Again, I don't like seasonals. The market doesn't know what a calendar is. Yeah. I've seen massive rallies in the middle of the summer and I've seen horrible fourth quarters. I mean, the market can do anything. But today's action, especially the S&P. Yeah. That looks great to me. Sandisk's earnings could be, I don't expect it to rectify their problems. I think this is going to need a very long time to cool and rebase. Like it could take into next year. That would not be really unusual. It may never come back. It's earned its place in history books. It's a Hall of Famer, yeah. Could it be the best number one Hall of Famer? [00:46:16] Alyssa Coram: Could be. I mean, that was in such a short time. I mean, pretty incredible. [00:46:24] Jim Ropal: So, I am super, I'm a 10 bull long term. Intermediate term, I'm kind of like five, six. Short term, I'm like four, five. I could go either way very quickly. But we're right at an inflection point here on multiple indexes. This is really a critical moment. And I think a lot of people who've been stung, they're like, I'm going on vacation. They're not looking. That's true. [00:46:56] Alyssa Coram: Yeah. So, in addition to the index level action, looks like you want to see more leaders working. [00:47:07] Jim Ropal: Yes. Clearly. [00:47:09] Alyssa Coram: You want to see that evidence. [00:47:10] Jim Ropal: And the best time for that to occur is where new names show themselves. It's earnings season. Yeah. And there's a lot of important leads coming out like this week. [00:47:20] Alyssa Coram: Yeah, yeah. This week and next week, for sure. [00:47:22] Jim Ropal: Are we up a lot in after hours? Palantir had a good number. Let's see. [00:47:26] Alyssa Coram: Palantir up 11%. Let's see what the cues are doing. Not moving a whole lot. One tenth of a percent. Not seeing too much in SPY either. But yeah, Palantir had a big number. [00:47:43] Jim Ropal: Okay, so the prescription would be a 10%, 15%, 20% chance that we just rip right out. And if it did, I would suspect we would have a violent pullback at some point down the road. Now, if we digest right here for a week, two, three weeks, and then come out, you could legitimately say possibly the Q3 historical slowdown has been absorbed. And that the round that we may get would be more durable. If we come out, the speculative nature of the market could be stronger than I think. And it would be, I would think, more fragile. But until we see the supporting characters emerge, I think I would try to stay with the liquid Googles and maybe some ETFs. And I just don't want people to worry. Okay. If you haven't done well, and I know a lot of people struggled recently, certainly with July. What's the World Investing Championship thing? What's that called? [00:48:48] Alyssa Coram: The US Investing Championship, USIC. [00:48:51] Jim Ropal: Okay, so the guys in the big dog category, which is only a million dollars. Like they, that's not really a problem for liquidity. As of June, that list was not looking like one of the big IBD guys. What's his last name gets with a T? [00:49:06] Alyssa Coram: George Kachuk. [00:49:07] Jim Ropal: Yeah, he's doing great. But the rest of them were not doing very well at all. And that was before July. Okay. If they weren't all in cash, they got crushed. People have had a rough time in memory and optics. And that's where a lot of the hot money was. It's okay. I strongly believe we are going to see this wave, this mega wave, go for a very long time. The Golden Goose is going to throw so many more names at us. Don't just understand why you screwed it up. Even me, I drew down too much. I own it. I'm a human being. I've just had a long, long history of at bats. 40 years of at bats. If you can catch a monster every three years, a stock that doubles or triples, you're going to be worth whacked out money if you don't spend too much. Yeah. [00:50:01] Alyssa Coram: Well, I was going to say you've had a lot of at bats, but you're still in the game in a big way. Still hitting some pretty big hits there, Jim. [00:50:13] Jim Ropal: They're not going to stop coming. They're just there until the Golden Goose is suffocated by socialism, which is on the move. Very scary to me. But the market capital markets do not look like they're going to make a lot ahead. The market doesn't believe that they're going to damage things too much in the short term. That's why I think the next presidential election is going to be absolutely critical. I mean, we could cement in the balance of my life probably the next 20 years if we get a solid president. If things swing the other way and socialism ramps, capitalism will be slowly, it'll be creeping socialism. And that will be, it will be suffocating. All you canceling guys who've made a fortune and you got rich, you do not want to see the Golden Goose suffocated. The comments column, I know there's going to be people throwing eggs at me. Bring it on. [00:51:08] Alyssa Coram: As long as they're golden eggs. As long as they're golden eggs. Jim, fantastic stuff as always. Where can the audience find more Jim? [00:51:18] Jim Ropal: @Upticken on Twitter, RopalReport. I will answer all your questions from all night. Any questions you have, I answer everybody's questions every Wednesday night. And then this Sunday I'll put out a monster report of all the leaders. Everything you need to know how to implement CanSlim. All my best ideas. And Allie, thank you so much for the opportunity. I love doing the Monday, Wednesday, Wednesday? Monthly. [00:51:43] Alyssa Coram: Monday. [00:51:44] Jim Ropal: Yeah. And one last thing. [00:51:46] Alyssa Coram: I love it. [00:51:47] Jim Ropal: Great. We love it. [00:51:49] Speaker ?: All right. Thank you, Jim. [00:51:50] Jim Ropal: We'll see you back here next month. [00:51:51] Speaker ?: Take care. [00:51:51] Jim Ropal: And thanks everyone for tuning in. That's it from us for today. And we'll see you back here next month. For another installment of monthly market research. [00:51:56] Speaker ?: Yeah. [00:51:56] Jim Ropal: We'll see you back here next month. Take care. And thanks everyone for tuning in. That's it from us for today. And we'll see you back here next month for another installment of monthly market research. with Jim Ripple. [00:52:06] Speaker ?: So we'll see you then everyone. We'll see you back here next month. We'll see you back here next month. Bye.