PREMARKET LIVE: The Trading Floor — Stock Market Outlook & AAPL PLTR Earnings

[00:00:00] Speaker 1: good morning everybody let's get you a banner I think this is one that's okay I don't know there's anything weird on that one I'll have to take a look in a minute we'll put this there and I got to use this one switch to that variant and get some tunes give me one second then we'll just go [00:00:47] Speaker ?: So, let's go. [00:01:17] Speaker 1: Hey, guys. We won't do the fancy opening or any of that. Let's just get to it here because I'm already behind. Why have it up? Oracle is doing a $10 billion equity sale. That's not going to be good. We'll probably get stopped out of that. I have a position on that. I'm probably going to get stopped out of it today. It's not great. Obviously, when they're selling their stock at this level. So, let's get to this. You have a lot going on here, like a ton going on. So, let's just start with the basics because I think that that's really important. So, if you look at ES, and a lot of traders love this trade, and they did it pretty aggressively on Friday. I don't know why my head's being cut off, but whatever. I guess that's what we got. Unless I lean back. If you do the undercut on the week or the month, and then everyone goes crazy, and then they buy it, and then it spikes up. It's pretty much like a lot of people in the futures room in the community do that trade. And they do quite well with it if you go and take a look at the trade and you come across with it. It's exactly where you balanced, and from that level, if you take a look, you can see like it's like a perfect, like it's an absolute perfect divergence right there. So, I think understanding that and knowing that there's a divergence there, it puts more weight on that level. But you'd have to think that at some point you're going to retest that, I think. I don't think you want to consider that you're out of the woods here. And the other thing that I would say to everybody is you're already not oversold. So, you're already over that whole level, and now you're coming into all these wicks, and what you probably want to do is just drop it there and watch that top one where you've held support, held support. So, you'll probably get to that 76, 75 maybe. If we get rid of that, and we just go to October, and we just drop this straight across from that level, that puts you right there at the top of that range as well. And I think that's really where this is heading. So, that's really where my head is with it. And, you know, we'll see how that plays out. But that's really where what I'm thinking right now. And I really think you're just going to hit this, and then that's going to pretty much be it. I don't think you're going to go much more than that. I could be wrong. People could get all giddy and all excited about the, you know, they could get all excited about the fact that you're ending the midterms, and then you're going to have the midterm people, and, you know, all that crap. So, I don't know. I don't put a lot into it. You know, maybe you rally off of midterms. I don't know. You know, who knows. But overall, I think he got some move here on world peace. But I think that's a bunch of crap. I think they already rejected the offer of world peace. And he's not going to be in a big hurry anymore. They overplayed their hand in Iran, in my opinion. So, I don't really see the reason why I would think that that's not going to escalate. I think there's an article by Axios today. [00:04:55] Speaker 2: And you can just see the spike here, obviously, in the market. Let's try to find the news real quick. I don't know what we did it. [00:05:03] Speaker ?: That's not what I need. [00:05:04] Speaker 2: Let's go to this. This will get me a hot headline. No, that didn't give me a – must be something out there. Let's find it this way. First move word, do you want to see if we can get it this way? I don't know, something. I'll find out what it is. [00:05:36] Speaker 1: Anyway, so you're seeing the spike in the market. You kind of fell – you know, you kind of rallied at the same exact spot. Let's clean this off. Let's go to a four-hour. And, you know, you're already not grossly oversold. And you can kind of see the same level. I mean, it's not really, you know, rocket science where that support level was and where you could probably trade up to. I don't really think that's, you know, rocket science. We go to Oracle. And I want to go back to Oracle in a minute here. And you're at the lower end of that October range. And so you're holding that. So, you know, it's a good sign. But I still think you have a lot of weight on you. So I'd watch this level, and then we'll go from there. I'm not in a huge hurry here to get involved and to really do much at all. And I say this, and then I'm usually, like, super active. But I don't think so. No, I don't think that I'm going to be overly active here off the open. I think there's some things that make sense from, like, a play or a strategic position. But you have a lot of earnings this week, like a lot. And if you already look at this, watch. You know, you're already overbought. So, and you're going to see huge spikes like this, and then those spikes go away. And that's what's going to start screwing people because they're not going to realize that you're trading like you're in a bear market. And that becomes an issue because everyone's like, oh, I got to get in. And then they wonder where it goes. And where it goes is it's just you have a short covering. So you probably want to watch that range right there. I don't think I really need to drop this. I mean, everyone kind of knows that you're below that, right? Like, I'm not really adding a lot there, am I? So let's get rid of that now. So, you know, maybe come up to that level. But, you know, if you can take a look at where you are in October, at least you get an understanding of where, you know, where that low is. And I think that's important. But I don't think there's much more to it than that. If you look at this from a Q perspective, you know, maybe you get back to 700 and then go from there. But, you know, these like spikes in the market, unless it's like world peace, like real world peace, I'm just not buying it. You know, I would just watch that 700 level. And then I think you can actually come back down to that 685 level at some point. You might see some relief rally on you might see some relief rally on the on the midterms being over. But then it depends, too, like, are some contested or do some are some fine? Like, how does that go? You know, there's a whole crap show there. In regards to the bomb market, what I think you're going to start seeing is I think you'll start seeing it tighten. And I think you're going to start seeing it tighten for a couple of reasons. One of the reasons why I think it tightens. Why am I dark? There it is. [00:08:30] Speaker 3: Yay. [00:08:32] Speaker 1: One of the reasons why it's tightened is I think people are having a flight to safety. And I think that's exactly what they're doing. They're just buying these names and they're just buying treasuries into the end of the year and saying, I'm going to sit out. The earnings that have come out so far today have been anything but good. And we'll just go through it real quick. So another software company, another blow up. And I didn't think it was that bad, but they're just priced to perfection. You did see TEM, and that seems to be holding okay. Estillard seems to be bouncing off of that. The consumer seems to be, despite what we hear, the consumer seems to have money. So, you know, we'll see how that goes. CIFR, this was a dumpster fire, but it's like a lot of people are short this. You're probably on the call right now. Yep. So a lot of people are short it. So it might squeeze, but that was an absolute unequivocal dumpster fire of a quarter. [00:09:28] Speaker 3: And what name are you going through? Let me give me a set up, put for put, and both spreads. [00:09:36] Speaker 2: Okay. Let me get this out while we're talking, and then I can take questions, and we can go through names. [00:09:46] Speaker 1: Iran says, contacts over ending war continuous talks end with no breakthrough. So, oh, there it is. So Checkpoint on the call just lowered their revenue outlook. So Checkpoint will be a mess. [00:10:14] Speaker 4: I don't understand today. I understand why this won't work for me. Is it not Checkpoint? What am I doing wrong? So there's no stock Checkpoint. Okay, this is fun. This will be fun. How about AMD? Is there a stock AMD? Okay. CKHP. Is there a stock there? I mean, what the? Okay, you just don't want to show it to me? [00:10:51] Speaker 1: I don't know. [00:10:51] Speaker 4: What did I ever do to you? [00:10:53] Speaker 1: So lower guidance. [00:11:09] Speaker 2: So that's Toast. All those names will come in like that, clearly, when they start doing crap like that. What else do I want to go over? Let's do this real quick. And, yes, let's do that. And then we'll go here, and let's get to it. All right. [00:11:30] Speaker 1: Spy resting at bottom level. Bull flag goes well. Spot, ice, let's go there. So let's just start. So something like spot usually does very well in an environment like this. And the reason is because you have cash flow. And everyone knows no matter what happens, you have cash flow. So these names tend to do very well in environments like this. I don't really like playing those kinds of names because you have cash flow. I'd rather buy low beta names because they're easier to get in and out of. But that's why it's moving. I'm actually surprised that you're not seeing Netflix find any bottom. But that could be tax selling as to why. To me, ice makes a ton of sense. It makes a ton of sense. So we're in this. The trade act's great. I don't understand. Like, they just created a whole new asset class of perpetual futures. And you're going to get traders on that. And I'm just surprised it's not up more. Honestly, John. I really am. Yeah, I think that what you really need to think about are things like, when you're like, do I take profits on the XLP side? You know, it's such an interesting question. And the reason why I think it's so interesting is a couple of reasons. Because I don't think you have an answer yet. Okay. And I'll just go through it. So, you know, do you double down on the XLP stuff? Or do you start rotating out of it? I don't think you have an answer yet. And I think that, so the answer to me is, I don't know. If I look at like S5FI, and I divide that by NDFI here, I'm not in my range. So the range for that, when the rotation happens on this, like if I took this, right, and then I did this with it, I'll just show you this. And then I took SPI divided by Q. And then I'll just take this and throw it up here real quick, and I'll show you this. So, and I just look at these areas where like the SPI, and this is the SPI divided by the Q. So you can see underperformance in the SPI every time that you peak here. You're not there. And it's a percentage, right? So it can take forever to get there. It doesn't mean it has to get there anytime soon. Like you can go through crap like this. So, but when I'm in this range, I do not want to be on defensive names. So like if I'm in this, I'm at extreme levels, and I don't want to be on defensive names. I'm not in extreme levels on a relative basis, far from it. And so I don't know that I would just get out of that stuff just now. I don't know that that's what I would be doing. I think I might chill out a little bit. If I have things like CCEP and I'm killing it, what I'm doing is just raising my stops over and over again so that, you know, depending upon where I'm in, but like, all right, if I close under this, I'm gone. I don't see things getting better. I saw some really big downgrades today, and I saw some really big moves that actually bother me a lot. Oracle coming out after everything said and done said that they were going to do like $20 billion in more bond sales. And really what they did this morning was hoodwink everybody and say, oh, by the way, that doesn't include equity sales. And then they just done $10 billion of equity on the market. So that's a problem, in my opinion. And it's certainly something that's going to bother me, to say the least. So I don't know. I'm not really feeling that right now. And it's, it's bothersome. So I, I would just kind of chill out. I don't know that I would just be going, I'm going to get out of XLP. You know, that's where my head is with it. I don't know that you're over. Signs that would tell me that you would have like be over as if like VXN got over 33 and then came back to it, things like that. But I don't know that I'm just saying, oh, we got to get out of healthcare or we got to get out of these other names. He's like, excellent, Leo come in today because, you know, world peace. And, you know, I, I'm just not, I'm not buying that, you know, at all. Um, I'm just not really buying the, you know, the, the world peace thing. Um, and so like oil's dropping precipitously. So at some point, um, you know, I'm just not really thinking that oil is going to fall off a cliff here, to be honest with you. I think people are going to look back and go, I can't believe I could have bought, you know, crude oil down. What is it down? 5% now. So, uh, I think we're down like 5% on crude, but no, wait, hold on, take a minute. Yeah. You're down 6% on crude oil. So, you know, I'm just not really buying it. Um, I, I don't really believe it. I think there's too many, too many things to think about. Um, Apple, I think there's too many moving parts to really care. Uh, I, I will not touch it either way. Last time Apple had a massive problem was here. It was a dumpster fire. I think your dual sales will be really good. The pre-orders as well. And I think your ASP is going to be up because of the duo. So I think people might just like that, but I, I don't have a horse in that race at all. I think if it dips candidly, the next day, it probably starts to hold because people are going to want something defensive that they know has huge cashflow and a reasonable PE. So I think the play is to look at it tomorrow. I don't think the play is to really look at it, um, today, but that's just where my head is. Um, I think that if you look at AMD to me, I think AMD is the most important number of the week. I shocked that I'm telling you this, that I think that, but to me, um, uh, it's the, it's the lowest, I don't know why I typed like that. Give me one second. It's the lowest, I'm going to eat way more caffeine. Um, it's the lowest probability to me that it rocks. Like if I, if I had to think about like which way it's going to go, I don't know how they're going to raise guidance, right? Like after Intel. Now they don't have the same consumer side, but they have a consumer side clearly. Um, and then with what Intel did and how bad Intel was, I just don't know how AMD is going to, to keep, you know, where they are. So, um, I think it's a real, it's a real issue. And I think that that could be like nailing the coffin for semis. So I don't think there's a bigger event on the, on earnings for the week than AMD. And it's a lot of weight on a company that's trading at a huge premium. So that's where my head is with it. What it does, you know, I, I have my belief, um, but I don't know what it's going to do. None, none of us do until it does it. Right. And they're not playing games with these names. And I think that's the point that people are kind of missing. Like they're not joking around here. Like if they want out, they want out and they're getting the hell out of this stuff. Like they're not, they're not screwing around and they don't care about the price point. Um, I think the Marvel deal is a really good way to look at the world. Right now where Marvel's just like, you know what? Our stock's like really up there. And right now we could buy another company with it. And to me, that's a really clear sign that they think that they're toppy. Like you don't spend your currency like that, at that amount on a company like light, unless you think you're topping out. Like you just don't do that. Um, and I think that's exactly what they're doing. I think they're using their currency because they're like, yeah, we're topped out. And I think they know they're topped out. And I think that's so like, to me, this is like a huge red flag for the four semis. So, and I, I could be dead wrong on that, but that you, for you to use your currency like that on a company, it's not like you're buying a company trading eight times earnings. You're buying this enormous high growth rate company. You know, that's trading up a lot 50 times earnings, 60 times earnings. Like it's insane. Um, and you're diluting the hell out of your existing shareholders. So I don't know. I, I don't know that I'd be long AMD going into this. The most interesting thing that I saw with this, and I'm going to have to go in a minute here, guys, because there's so much going on. But if I could tell you the most interesting thing that I saw were two upgrades on PLTR this morning ahead of earnings, um, especially the way software is acting. I thought that was super aggressive for two firms to do that. I thought the Akamai getting three downgrades this morning before earnings, like, what the heck do they know? They clearly think they know something. So I thought that was really interesting. Um, because it wasn't like, it wasn't just like one firm, it was three firms downgraded it ahead of earnings. And then the biggest downgrade I saw today, that's worth mentioning, uh, Oracle, you know, 260 from Morgan Stanley to 120, like they just slaughtered it. So they see a lot of problems here on the crypto side right now. Uh, I don't know if it's because of finance or what it was, but they cut guidance like huge there. And I think that's really very important as well. Um, so let's just go through this real quick. [00:21:43] Speaker 2: Um, let's just go through this. [00:22:13] Speaker 1: government authority to talks. Maybe that's doing it. I don't know. I don't know why that would be such a big thing. Maybe because you finally have someone that people can actually talk to. People are excited, but I'm not buying that at all. Yeah, I think you need to be really very cognizant of these kinds of names. I don't know what this does tomorrow. It better have good earnings, and they better be fantastic because they're not playing games with software at all, guys. You're down 20% like chicklets on some of these names. CHKP, if you take a look at them. They're just not playing games with this stuff, and they're missing revenue guidance, so it's not great. OSCR, that'd be an interesting one to look at. You're rolling over. FCX, I would think copper would do well, but they're blowing out of the copper names, which actually is also concerning because why are they blowing out of copper? It's really weird if you think there's demand there. It doesn't take away my fear. Light earnings. Who cares what light earnings did? It's the last time they're ever going to have earnings like that. Yeah, the McDonald's, I'm not interested in. The time to play that thing is down here for whatever reason. There's this huge level down here that it always bounces off of. I don't know why it's so exciting when it's down here, but they buy it off there. From a value play, that makes sense. VLL, I was looking at. I might get a better shot at it today since we're going to get world peace, and I'm just not buying world peace. So I definitely am going to look at that today. There's no doubt about it. Go through these real quick, see if there's something I have to cover. LAM I wouldn't touch. NVIDIA I'm not interested in. Well, TRUX. I'll take a look at that TRUX. Then I'm going to have to jump, guys. I got too much going on today. I wouldn't go near it. I don't know anything about it, man. I wouldn't touch that. Oh, VLTO. I'm sorry. I got VLO on the brain. Yeah. I mean, I would rather close up 50% on those bars. If I don't close up 50% on them, I don't go near them. Because that means I have net sellers on the day. So I need to close over that level for me to get that. So you want something like this on an earnings jump like that. Despite what the volume is, for me, you should do what you're comfortable with. But that's a great gap up. But if you look at something like REGN, gaps up, closes at the high, that's what you're looking for, that kind of thing. So I don't know that it's just demand destruction, but I think that you're, you know, these guys are buying, these guys are buying chips and they're putting them in warehouses, right? Like they're not implementing them. So are these warehouses full? Like there's a whole list here. Are they slowing down because of the regulatory concerns that are going on with the data centers? Like, I don't know what the issue is. My hope is that it's an Intel issue and it's not a CPU issue, but I'm going to trade whatever happens. And so I think before you can make any decisions on that, you have to realize two things. One, software's toast. Like software names are just toast. They're just going to get destroyed. And the other side of that is going to be the anomaly. So like if PLTR crushes tonight, I wouldn't be surprised with the upgrades they'd sing. But the majority of people are of the camp and they're right that software is going to get destroyed. I watched this guy, I was talking to one of the guys in the community about this. We watched this guy have to put on like millions and millions of puts in here on IGV. And I'm like, and he was doing it like way out, like it was huge position. Like what the heck is he thinking? Well, this is what he was thinking. And so as these names start coming out, they start doing like really bad. And so to me, that that's a real problem on the software side. So you lost, you've lost software. Like the numbers are awful. I mean, like you can't look at software and say like, this is going well. I've seen well before. It doesn't look like this. Right. So, so then you think, you're right. You don't have software. You don't have the mag seven anymore because the mags are down. Why? Because they're just like, we don't care. We're going to issue tons and tons of stock and we don't care what you guys think. And so you can see how they're acting on earnings. Like it's, it's, they're just not holding. Like maybe they'll bounce, but they look like dumpster fires. So what do you have left? You have semis and semis are here and semis just did this. So here's your 200 day moving average. And we just closed below it. So like, I don't know what I'm supposed to be getting so excited about some kind of bounce. Okay. Like, and what's that going to do? So you need something to change the tide, right? If they kick up the leg of the fundamental side of the market, you need something. So if AMD comes out and is like, we don't know what the hell Intel is talking about. You know, we're raising guidance. Our margins are here, blah, blah, blah. This is demand. Everyone's going to go, oh, oh, okay. But you know, you also have SanDisk, which was not, you know, they beat, but it was the slowest growth that they've ever beaten by. So, and then you had KX, KX, AY, is that it? KX. That was all right. Yeah. That one. Right. And these people share the same exact foundry. All the foundries for NAND all come out of the same foundries and they're the two companies that sell it. And they came in and they lowered their guidance for next quarter, but they sell to different people. So, you know, a lot of weights on AMD, like a ton. And that's what I, that's what I'd be paying attention to. So, all right, I got to jump guys. Trade to win, make good choices.