 The following is a presentation of TFNN the morning market kickoff With your host Tommy O'Brien Good morning everybody, I'm Tommy O'Brien coming to you live from TFNN Just after 9 a.m. Eastern time Thursday morning coming into the long weekend markets closed tomorrow for good Friday coming into Easter Sunday We'll have some action tomorrow in terms of economic news though. You get non-farm payrolls out tomorrow at 8 30 a.m We're gonna be off the air folks enjoying our Friday I hope you do as well for a long weekend But it is interesting as the market prepares for that economic data that we'll get as the market is closed does not happen often But it happens tomorrow tomorrow, and we got some jobs numbers today jobless claims a little bit elevated We'll jump into those in a moment, but you get the market right now trading a little bit lower There's 8 o'clock in the morning up to a high of above 41 24 and since then we're dropping. We're down to basically the pre-market lows Those lows overnight 4105 we're trading right now at 4109. We made it just under 4100 briefly yesterday in the S&P's Nasdaq 100 we're negative by 66 points right now You can see coming into that lower boundary area in the Nasdaq 100. We'll call 13,000 right on the dot Dow All 50 points and how about the Russell? Positive by three this morning pulling back a bit But well off of the lows of where we were yesterday for the Russell 2000 Bitcoin 28,000 on the dot this morning 28,000 down about 385 bucks crude Look at the low volatility in crude, right? We're getting extreme volatility in yields We're getting pretty decent volatility right now in the markets in both directions And crude just been chopping around between about 80 and 81 dollars make it up to 81 81 Just below that level throughout the week and we're trading at 80 54 goal contract quite the acceleration this week 2026 gold technically negative by about ten dollars on the session We're coming back to the lows that we had last night at about 11 p.m. Eastern time And you jump to notes and bonds and a little bit of lower price higher yield But all things considered folks we got the tenure right now sitting under 3.3 percent under 3.3 3.298 to be exact so call it 3.3 percent the yield on the tenure and Out of curiosity, what are we talking about on the two-year right now the two-year? 3.785 we'll jump to the two-year as we pull back just a bit 3.785 the two-year negative by almost two ticks is that right? Yes, it is from the session yesterday, but a little bit of a pullback from that 830 number and why not? Let's jump into the jobless claims And as Bloomberg puts it beat estimates after updated seasonal factors So the number here initial unemployment claims decreased by 18,000 to 228,000 the market was looking for about 200 So we have more than the market was looking for but what's important here is the revision to the previous month How about adding almost 50,000 jobs to the month of February that number goes up to 246,000 so what do we got we got 246 and we got 228 in the last two weeks those are rising numbers from what we've seen Recently and continuing claims, okay a big number there 1.82 million unchanged, but more than what the market was looking for Yeah, and this one it's always interesting the seasonal factors, right? Things had just been adjusted in terms of how they factor in those seasonal factors during the pandemic given that just there's just Let me read that one again I'll just read it out Economists at the Labor Department had to switch the way that they adjust for seasonal factors during the pandemic given that the distortions were so large Today's report maintains that method for the first year of the pandemic But uses the traditional way when looking at data before March 2000 and June 2021. I don't even know what that means I mean I do but you see how things can get distorted, right? So what are they saying here that report maintains that method in terms of Switching the way that they have seasonal factors for the first year of the pandemic But uses the traditional way when looking at data before March 2020 and after June of 2021. So It's interesting that you have one way to use the data during the pandemic in another way afterwards Yes, there's definitely different seasonal factors during the pandemic But when you start factoring in different adjustments and are those adjustments always correct? I'm not sure but nonetheless bottom line is four-week moving average of initial claims 237,000 from an upwardly rise to 42 in the prior period pretty decent numbers We were dealing with under 200,000 for a while on initial unemployment claims. We've gotten a lot of soft data recently For the economy and the market Yeah slightly Pricing that in as we've seen a slow and steady decline We reached 41 71 on Tuesday you trade off on that number and it's been lower lows and lower highs since then We're coming into the final trading day of this week as we come into a pretty important non-farm payroll number And that's following the ADP number we got on Wednesday We jump over to the VIX this morning volatility index. Yeah pay attention man VIX spiking back up to near 20 All things considered relatively low But not in the 18s anymore. We're getting a little bit of a spike today. Maybe this is the Beginning of some tough economic numbers as we come down the line and boy, we got a while to go folks Is what I will say there All right, let's jump to some of the headlines. Yeah, US profits set for pandemic size drop Well, that might be exaggerations a bit We've only seen one pandemic in my lifetime and hopefully that's it only three sectors to see margins expand this reporting seasons Investors to focus on margin outlook good old AI cash use and China in there Excuse me folks still getting over a little bit of a cough as I get it out of my system But this is Goldman Sachs Analyst consensus expectations for S&P 500 earnings per share to fall 7% in the first quarter from a year earlier Marking the sharpest decline since the third quarter of 2020 and a low point in the profit cycle Those are a couple strategies from Goldman Sachs if analysts projections are realized this quarter will represent the trough in the S&P 500 earnings growth A deep contraction in margins will mostly outweigh modest growth in first quarter sales just three sectors Energy industrials and consumer discretionary a forecaster report and move improved margins Yeah, we'll see where they go out man, but we get bank earnings next week well folks and they go from there We get some of the biggest banks out next Friday. Let's jump into it right now. Why not? Let's check out some of the banks Bank of America, I think they're the only big one that is actually out the following week Are they know they might be the 14th? Come on catch up for me No, yeah, they are so Bank of America is the biggest one that is not next Friday, but we do get JP Morgan I believe System a little slow playing catch up. There it is JP Morgan. They'll be out with their numbers next Friday I believe we get City Come on and Wells Fargo as well a little bit slow on the earnings take up here as the market Might have to restart that think or swim at the break But yes, we got JP Morgan City Wells Fargo among some others next Friday. What is interesting? You know what we get first though? We get first Republic a week from today folks gonna be interesting what they have to say right first Republic out with their numbers a Week from yeah today, and then we get the big banks that follow and it's gonna be an earnings season that the markets Can be watching closely and then the big tech stocks Apple May 4th out there towards the end of April Yeah, Google April 25th out there Microsoft shares April 25th as well Amazon April 27th Netflix April 18th. Let's Tesla shares April 19th, so they're coming quick as we get into a bank earnings kick things off A week from tomorrow and then we get into the season We'll finish up the discussion. We're talking about some of those earnings numbers We'll take a look at some of the other equities moving this morning. It's Thursday before the long weekend We got markets in negative territory S&P still sitting above 40 100 folks. Stay tuned. I'll be right back If you're looking for potential trading setups in the stock market Then rocket equities and options report is a newsletter You should try Tommy O'Brien delivers options and equity trades when the markets present them using a combination of Fundamentals and technicals sign up for rocket equities and options report today with a 30-day money-back guarantee So you have nothing to risk for all the details and to start your subscription today visit the front page of TFNN comm TFNN educating investors Everything in the universe is governed by the Fibonacci sequence this mathematical principle is responsible for everything From the most aesthetically pleasing artwork to patterns in the stock market to stay on top of stock patterns You can take advantage of sign up for the Fibonacci 24-7 newsletter at TFNN comm when you subscribe You'll get a weekly report from veteran day trader Larry Pezzavento on stocks You need to pay attention to and you can trust Larry's analysis after all He's got 45 years experience as a day trader Larry will also provide daily charts videos and data on the key markets that he's tracking Expect notifications from Larry on market movement You need to act on at any time first time subscribers also get a 30-day money-back guarantee if you're not satisfied Let us know and you'll get a full refund within 30 days of signing up Subscribe to the Fibonacci 24-7 newsletter today TFNN comm educating investors Steve Rhodes started his trading career as a student almost 20 years ago and the student has now become the master Steve won the prestigious timer of the year award in 2018 and barely missed that mark again in 2019 Finishing it number two for the year an amazing accomplishment Steve Rhodes is committed to sharing his techniques and knowledge With anyone who wants to learn and he shares his vast amount of trading knowledge every day in his mastering Probability newsletter Steve's award-winning newsletter Mastering probability is delivered every trading day with updates throughout the afternoon sign up for Steve's market newsletter mastering probability and you'll receive access to seven of Steve's educational webinars Absolutely free at TFNN all our newsletters come with a 30-day money-back guarantee So you have absolutely nothing to worry about visit TFNN comm and try mastering probability 30 days risk-free today TFNN educating investors TFNN has launched the Tiger's Den hosted at Discord TFNN has been educating traders for more than 20 years with live programming hosted by a variety of professional traders during market hours The Tigers Den available to all Tigers and Tigris's for just one dollar for the year There's no catch or added costs when you join our community of traders sign up today and become a part of this educational community of traders just visit the front page of TFNN.com Welcome back folks. We get the S&P's negative by about 10 points right now trading at 4107 Let's jump over to our man Kevin Hanks every trading day folks 12 noon Eastern time from the TD Ameritrade Network fast market with your host Kevin Hanks Tom White the whole team at TD Ameritrade Network They get some great guests folks They walk you through hypothetical trade setups if you ever want to learn about options You want to learn about defined risk even if you don't trade options folks Understanding how they work how they trade how they're priced how the premium is in them Please check out the program and every trade they go over folks has defined risk and in any market defined risk I believe is is a quality that you want to look for man because undefined risk you better watch out in this market Kevin Hanks Good morning Good morning, Tommy or Brian a lot going on this morning ahead of tomorrow's payrolls data that we won't be open When the payroll data comes out a unique experience, but Tommy It's interesting. We got jobless claims first-time file is for unemployment insurance this morning and the headline number is not the surprise It's the revision of last week We came out with a number 228,000 as you know, but last week's 198 was revised up to 246 So now you're talking about a whole different outlook for the job market and Tommy We've had three Employment data points so far this week jolts, which was weaker than expected ADP which was a mess jobless claims now much higher than expected. So you've got to think tomorrow's employment data not bar payrolls unemployment The expectations are for 240,000 jobs and a 3.6 unemployment rate You've got to think lower on the jobs and higher on the unemployment rate Tommy Pretty interesting as traders got a position themselves right coming into that number when normally you get it 830 markets open at 930 We're gonna get it 830 tomorrow I'm gonna be enjoying my day off with my son probably hanging out drinking some coffee and then you got three days to digest it Man before markets open on Monday With that in mind Kevin markets, you know, not a huge reaction I mean we're still sitting basically where we were almost last Friday, which is interesting because you put it I mean pretty weak numbers and what do you think Kevin that? These numbers are from March and we saw the banking crisis kind of developed March 7th 8th I think it was March 8th 9th 10th things really accelerated for Silicon Valley Bank point being That data not really into the March data. Yeah, that made it tighten things up a bit But area the whole discussion if that banking crisis is gonna really influence things Which of course it's gonna tighten things to some degree not really in that data just yet So what do you think that we're seeing some slowdowns in the data at a time when you know Is capital gonna become a little bit tighter probably? What do you think about as we go forward man? Cuz pretty stark to see just like you said we got three numbers in a row that are saying hold on a second man We might have some weakness in the economy and if this is the lag catching up Kevin I think we got a little bit ways to go here and that's kind of some of the rhetoric you're hearing out there in the market Well, there's no saying in trading Tommy the inevitable is always certain, but it's not always punctual right and We've been waiting for some of this economic data the weekend and suddenly here it comes Right and if you look at the flow of economic data so far this week It's been weak across the board and so the reaction in the US dollar the reaction in yields has been predicted What hasn't predict been predicted is the movement in stocks, right? Everyone thought lower dollar or lower yields would would put bids or floors in for stocks and so far it hasn't now Here's the good news what's weakened the markets throughout this week has been a lower Russell, right? So the Russell is actually firm this morning Maybe that will take some of the volatility out of these names Tommy, but you know, this is gonna get interesting a week away Excuse me from bank earnings and then we go right into high-cap tech. It's gonna get interesting the next couple weeks Tommy I was thinking about you when I saw the Russell this morning Kevin. I got the thinkorswim platform up here I'm going through the indices and what's green the Russell screen a little bit of a different story man With that in mind as you mentioned we're all off tomorrow. Thankfully, we'll be watching that economic numbers But we got one more trading day in the week. Kevin. What are you guys talking about coming up on fast market at 12 today, man? We're gonna trade crowd strike. That's moving this morning We're gonna trade Target and a little exception of the Ulta conversation that we had earlier in the week as you know, Ulta has little shops within targets So we're gonna look at target For the overall retail and then like fully was gonna do a presentation on lows So three interesting names as we get a week away from first quarter earnings season. I like it man Well Kevin, I appreciate the time as always man We talked to you three days a week and it seems like every morning man We got some economic data driving the action and as a trader. It's so cool. I'm always saying, you know We're gonna have what do you think about the volatility Kevin? Let's listen before we we've got the vex near 20 But I see a period and you've been in this business or so long man. There's nothing like experience It's it's a period of time in my opinion and I don't have the experience you have But I see volatility staying with us for a considerable period of time when we have so many hurdles to get over What do you think about that kind of big picture of the volatility man? Because not only are we still in the Fed hiking cycle But now we have as you mentioned the lag in the economy and we're gonna start maybe transitioning to All of these numbers actually mattering where bad news is bad news, etc What do you think about the volatility as we stretch forward Kevin for whatever it is months or even possibly years? Well, I think if you if you look about it, you know that the Vix It's still historically elevated, but over the last maybe 18 to 24 months It's not elevated as elevated as it was it's still got a long-term history of around 15 point four So you have to look at where you are in the calendar You have to understand that we're going into spring and summer so that has an effect on Vix as well Tommy but You know Vix is worth watching here and see if it gets back to some levels, but you know If the market reacts favorably Vix will you know it needs inertia to stay up these levels and go higher Well now the last two years it's had plenty of inertia. I don't know if it has it right now So yeah, that Vix is just another one of those things we have to pay attention to Tommy It's pretty cool man I put it back the Vix on a five-year weekly To stretch it out a little bit further and almost hard to remember we were dealing with Vix in 11 We were at 856 Vix back in 2017 folks. So maybe that's where my brain is in terms of volatility with the Vix at 20 More beneficial in my opinion man as we get movements in both ways in this market Kevin I appreciate the time as always man We look forward to the show at 12 have a great long weekend man have a great Easter and I look forward to talking to You on Tuesday man Talk to you soon Tommy. Thanks. Okay folks check it out every trading day. You heard it They're talking about three great stocks man crowd strike. Did you see the movement yesterday on crowd strike man? We pull up the daily Let's put it back to a 15 minutes This really see the pullback you talk about a pullback man from 136 down to 125 We're sitting in 125 80 and then two good stocks man target Take a look at target put this thing on a three-year weekly just chopping around right from that pullback They had basically a year ago on their earnings in May this thing Creators from 220 to 160 you just been chopping around there And then of course you jump over to Lowe's always a little bit of a a wild card with the housing market in Lowe's And interesting to see that they trade basically the first quarter right and then they've held up pretty well And boy these home builders man Really interesting to see where the market's going to go when you look at the acceleration They've had right check out linar Did you think that this thing was going to accelerate from a price point of 64 to 104 meanwhile? We've had mortgage rates Just skyrocket compared to comparatively where they've been DH Horton not quite the same acceleration. So there's winners and losers in that area right there interesting I've talked about the development going on near me in Lakeland Uh linar and DH Horton both building hundreds of houses in there And you see the divergence where linar basically back to where you were at the beginning of last year versus DH Horton Not the case man. They're trading at 247 down from 320 and uh pushing lower boundaries. Stay tuned folks. 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We get markets open. You're looking at smp open down about eight points right now Interesting right rustling the only one of the positive right now. We jump to commodities You get the gold contract right now boy. That's quite a weekly chart man from 16 18 in october pushing the highs of 2000 2027 that high from march of last year 2078 The high from the pandemic 2020 2089 pushing those highs man that gold contract and we jump over to yields the tenure Talk about a breakout man bud ross the channel master you're in this channel you break out of it That's not the buy folks. Where's the buy the buy was the retest and boy you talk about an acceleration man And what did it take sometimes you never know how it's gonna happen folks The technicals lined it up and what happened the fundamentals made it happen with the banking crisis And uh, yeah, my dad was talking about it on his show yesterday, man This is alleviating some of the problems going on right now You know you got the tenure if you're holding 10 years on your books You could have got 110 for it now you can get 116 Well, that's a big number folks because you look at the number of a company like silicon valley bank What do they have almost a hundred billion dollars in 10 plus year securities? Well, if you had a hundred billion bucks, you just made six billion dollars, right? That would be six billion dollars less losses and i'm ballparking all this stuff It's not exactly how it works But just to illustrate kind of in the simplicity of it The mark to market for those securities, okay when you're dealing with numbers that are that large Yeah, that would have shaved six billion dollars of losses off their books almost something like that Okay, you get the point Uh, nonetheless, it's alleviating some of the problems, but we are not out of the woods yet folks Not even close As the markets turn red russle in the red by one All right jumping back to that story. I was talking about goldman strategists looking for as they put it Pandemic size drop for profits. Well, just one chart. I wanted to pull up I didn't get to when I was first talking about it and it's talking about the sales outlook is solid Well margins expected to deteriorate they're selling more products folks. They're selling more products partly because Inflation they're getting a charge more for the same products They're selling okay, but take a look at it normalized as of April 6 2022. So if you started at that date, we're going back a year ago today, okay In the black you have the s and p 500 12 month forward sales estimates They're selling more product But look at the forward margin estimates almost an 8 hit across the board meanwhile, they're only selling 6 more This is what we're going to be dealing with man margins are going to be Front and center as we come into earning season And as I said, they started off with the banks next week And then you get into the tech companies the end of this month the beginning of next month And what do you got after that man? We got a fed meeting right at the beginning of may on top of it all All right, we're going to jump to the big dog apple Let's see how apples trade this morning before we jump around back to a 15 minute chart Markets trading sell folks I don't know if you want to be a buyer going into that jobs number on Friday for a three-day weekend Seems like that might not be the case apple shares down a full percent this morning. Check out the nasdaq 100, right? You just gave up almost 400 points from where it was on tuesday man nasdaq 100 the weakest index off eight tenths percent You got the s and p off about four tenths percent and you got the dow off about two tenths and the russell off about two tenths But back to apple shares Apple's got quite a cash pile here. They're doing nothing with it. Then that's what the article is about here How about a hundred and sixty five billion dollars in cash? Merger and acquisition mirages disney is the latest potential acquisition target to be floated I mean, what's what's disney floating with right now 200 billion something like that maybe market cap jump over to the analyze tab You jump over to the fundamentals for disney and you're talking about a company valued at Come on Where are my books? I think it's just slow on the uptake here. There we go 181 billion dollars is the market cap for disney as you're trading at 99 11 right now I don't know that would be quite an acquisition for apple You jump over to netflix just for some comparative takes in terms of market cap wise Yeah, that's this market picks up a little bit of steam My system have a trouble keeping up right now with what's going on Netflix market cap wise you're talking about 150 billion dollars and then you get into like an interesting one right talk about pennies on the dollar If they would ever think it would make sense you jump over to roku. Let's take a look at the chart here first roku shares Basically at the doldrums man. Yeah, I mean you're at 38 bucks. All right, so you're none of the doldrums, but You're off of 500 dollars Within the last two years twice So yes, you're at 60, but all things considered folks you were at 60 dollars in november before you traded So all you've done is you've gotten back to november prices for roku, but When you think about acquisitions 8 billion dollars seems like a much better price than 150 or 180 billion dollars now roku eight disney roku eight netflix. Okay, not even close but You take a look at the money that they've got on hand man and look at what they've done They've spent none of it. Okay spending on mergers and acquisitions for disney apple's limited merger and acquisition Activity has slowed in recent years. It's basically nothing. They spent 1.5 billion in 2020 nothing in 2021 and barely nothing in terms of the context of how much money they have in 2022 Um, and everyone gets talked about here folks. Okay I mean, do you remember when roku Originally caught a run like a year ago because they were thinking netflix was going to buy roku Yeah, that didn't play out at all And as they say here they've all been talked about whether it was disney netflix tesla, okay or peloton And sonos why not they've all been disappointed because it happened has not happened And yeah, they've been very shy to spend any of that on that type of money in terms of mergers and acquisitions and apple They're outperforming and boy, they are carrying the market practically with many of the other tech stocks doing the same You check out apple shares. I've talked about it this year alone What are you up? You're up almost 30 percent this year alone and really if you put it in the context I mean you got to imagine right? We're dealing with let me put this back going back three-year weekly for apple to really put into context the biggest company in the world Folks, okay This is not what max pain looks like in the economy And hopefully we don't see what max pain looks like in the economy because you don't have the biggest company in the world Which in theory has the most investments in the world because it's probably what are we pushing here? 2. Something trillion dollars, right? 2.56 trillion so above 2.5 trillion dollar company And meanwhile apple's barely down. You're just back to where you were in december of 2021 as in there's no pullback essentially all you did is you gave back a run up to 182 And yes, that's 20 dollars and yeah, that's 320 billion dollars in market cap when you got 16 billion shares outstanding for this company But is that really what a real Fear in the market looks like where the biggest company in the world barely has a pullback As we are still dealing with generational inflation folks, okay the adp numbers out You stay in the same job. You got a seven percent rage raise. You change jobs. You got a 14 percent raise That is pressure on inflation, man Okay, so keep this in mind because you start getting these tech stocks roll over and yeah You'd be in big trouble, man Microsoft shares on quite a run as well up to 283 now microsoft not quite back to where Apple was right in terms of getting back all the losses up to december But still you're back to where you were in october and keeping things in mind folks You're back to where you were in october of last year Okay, october two years ago, excuse me, but that's after you had basically a one-way trip For the better part of 2008 up to the highs and all we've given back is a couple months of gains So There is the opportunity for greater losses in this market folks whether it plays out or not What's apple gonna do? Well instead of splurging on deals They've returned much of its excess cash for buybacks and dividends 100 billion dollars just in last year alone We'll finish this conversation up when we get back. Stay tuned folks You might think that if you want to be successful at trading in the stock market You're going to need a crystal ball after all it's impossible to predict the future, right? 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Tom O'Brien is here to help Tom O'Brien has been successfully trading markets for over 30 years A frequent contributor to TD Ameritrade network and CNBC Tom O'Brien founded tfnn over 20 years ago to help educate investors just like you Tom's daily market newsletter market insights is published every morning when the market's open to give you the competitive informational edge you need to succeed These newsletters are packed full of tom's advanced technical analysis and are geared to deliver comprehensive strategies for a successful portfolio Get tom o'Brien's newsletter market insights today And try all of our products and newsletters 30 days risk-free with our money back guarantee at tfnn.com tfnn educating investors Will the s&p 500 continue to climb for bold trades on us large cap stocks in either direction trade spxl spu u or spx s Directions daily s&p 500 bull and bear Leveraged ETFs direction leveraged ETFs an investor should carefully consider a fund's investment objective risks charges and expenses before investing A fund's prospectus and summary prospectus contain this and other information about direction shares to obtain a fund's prospectus And summary prospectus call 8664767523 or visit direction investments.com A fund's prospectus and summary prospectus should be read carefully before investing An investment in the funds is subject to risk including the possible loss of principal The funds are designed to be utilized only by sophisticated investors such as traders and active investors distributor four-side fund services llc This program is brought to you by vista gold traded on the nyse american and tsx under the symbol vgz Welcome back folks We got markets continuing to trade lower and just because we got maybe a low volume day folks Sometimes you can get greater volatility when you got less participants in the market We're off a solid 25 points from where we were at about 8 a.m. This morning right now You just dip below briefly the lows we had intraday yesterday and we just eclipsed the 4100 price point in the markets on the s&p We jump over to yields. See how we're moving on yields right now Not quite the movement that we're getting in the market. We do have some volatility Let's check out the dollar index right now dx y a little bit of a spike higher above 102 But all things considered um pretty tame action as we come into the long weekend But boy the day is young man. We're only 12 minutes in the trading day and as I said You know, sometimes things can be erratic Because of the low volume, but it doesn't mean that you're guaranteed low volatility in this market as sometimes less Participants can allow for greater swings in the market and they will see how it plays out market down about 20 points right now Jumping around to some of the articles I had pulled up here as well. How about this one from the journal stocks have not looked this Unattractive since 2007. I mean now you're seeing all these headlines folks. All right. I'm not cherry picking them Okay, the I'm not giving you the bear cases. I'm giving you the cases period And they're all over the place right what did we start it off with Goldman started off with us profit set for pandemic size drop the journal out here Stocks haven't looked this unattractive since 2007 Do you remember what happened after 2007 folks and what this is talking about here the equity risk premium? Okay, this is the gap between the s&p 500's earnings yield That's pretty important the earnings yield of a company is basically what it's defined on and the taz your 10 year treasury Sits around 1.59 percentage points a low not seen since october of 2007 right Yeah, we are in especially interesting times. I mean what you're seeing a play out in terms of it being talked about folks But even where yields are right now Okay, there is a huge competition for capital with the market in a big way And you're seeing the the 10 year drop to a level of like 3.8 percent. Okay but What's important to realize is that cds aren't that low yet because banks still need Capital they need money. Okay, so what's interesting is you still have some real competition Okay for yields now. I'm just taking a look at them right now. Give me two seconds to pull them up And yeah, so you're talking about A two-year cd folks non-collable is still 4.65 percent. That's right now. I just pulled it up a five-year cd 4.4 percent Those are really decent numbers and that's going to be competition for this market For a long time and the reason why I bring it there is because This is going to be distorted a bit because we've had rates so low for so long. Okay, so low for so long And that's why you haven't had any competition Right. I mean if you're in retirement You can't just buy fixed income when it's paying zero percent folks. You can't do it. There was no way to do it I mean you can do it to avoid capital losses Okay, but you're not making anything on your money doesn't be it's not the case anymore I was reading an article a couple days ago in terms of retirees They got a lot of money in cash and that's probably the right play right now Depending on your risk um Your capital the the amount of money that you might need the risk that is associated Guaranteed 4.4 percent for five years. I mean if you put together a five-year ladder right now folks Okay, that's getting you 4.6 percent almost 4.59 is what I pull up and that's pulling yourself a five-year ladder But if you just want a five-year 4.4 percent you push a two-year ladder You're pushing 4.8 percent for a two-year ladder right now Remarkable rates and it's going to be competition and this illustrates it. So because the risk free Return is so high compared to where it's been. Okay, so keep this in mind man because You know you see charts like this folks and they talk about it on a couple different levels The first one they do it is they talk about it the equity risk premium You're only getting 1.59 percentage points. Oh, geez folks. I mean, yeah, you know Of course we can get over inflation. Of course the economy might not be as bad And of course over three five years or something like that stocks may be dramatically higher Okay, but are you willing to ride that out? And are you willing to ride it out for potentially only? a earnings yield premium of 1.59 percent Meanwhile, you got a risk-free rate of return that I just told you a five-year ladder is giving you 4.6 percent right now That's a heck of a return man now As they say the equity risk premium falls when bond yields rise There you go or stocks p e ratio jumps either due to weaker earnings. Okay, or higher stock prices Yeah, that would make the case What they also talk about in here is the cap ratio now what this is is this is Based on the s&p 500's price level relative to inflation adjusted corporate earnings over the past 10 years or the cap ratio Okay, although well off prior peaks seen in the late 1990s Okay, but we know what happened when we got up there. All right. We are still pretty decently above where we usually are Yeah, well, what happened? We heard all the talk about things getting lofty But look where we've been relatively over time We're at some lofty levels man. Take 2000 out of the equation because you know that wasn't real. Okay that bubble burst 2021 We've had 10 to 12 years of free money folks. Okay, and these charts illustrate how out of whack things have gotten Compared to where they've been this chart goes back to when 1950 almost something like that So keep those in mind when you see these numbers when you see a company like apple trading right near all-time highs Almost trained to where it was in december of 2021 and you see a market sitting at 4100 And we see headline after headline talking about pandemic-sized profit cuts. Yeah, because it may be coming down the line All right, what else we got pulled up. Let's jump through some of the articles we got here Yeah, google and amazon, right? Let's see what we got. Well, no, let's stay on the let's stay on this one Okay, the imf economist who foresaw who foresaw 2008 crisis expects more bank troubles. You better believe it's not over yet Folks, okay, we get first republic earnings a week from today. That'll be interesting to see what they have to say But there is going to be a battle here because they still have losses on their books and There is still the incentive folks Okay to make sure that maybe you're pulling money out of those areas and so it's going to play out Um His quote I hope for the best but never never a good start to a sentence expect that there might be more to come partly because some of what We saw was unexpected The entire concern is that very easy money and high liquidity over a long period Creates perverse incentives and perverse structures to become fragile when you reverse everything and everything's been reversed in um An instant in terms of how yields have moved over that time and I think the important part here, okay Over a long period and that's what's So difficult I think for all of us to understand Which is why things have come out of the blue. There's just the woodworks, uh surprisingly It's been zero percent interest rates since like 2008 folks. That's 15 years later. Okay You got people that graduated college in 2008 They're now approaching 37 years old. They're almost going to be into their 40s And they've never seen a time that we haven't had zero percent interest rates. I'm pretty close to that I was in 2002 Okay, you start talking to me about seven percent mortgage rates. You start talking to me about car loans six to seven percent I feel like I'm getting fleeced The impact could be harsh as things stretch out My guess is it doesn't mean banks are going to collapse But guess what it could mean that they're going to be tightening more than you may expect And that is going to cause a strain on the economy at the same time that we got all that lag catching up for those hikes S&Ps at 40 one oh one one more segment folks. Stay tuned. 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We got the s&p's right now down about 19 points and you can see folks. We're reaching an area I mean, we basically just got within a stone's throw of the market highs back in February And technically, I mean, that's an area of resistance and we've traded off that area We'll see where we go from there. What else do we got going on this weekend folks? It's master's weekend, man They kick it off today. If you haven't Downloaded the master's app folks. I download it for about four days a year. Downloaded it early earlier this morning. I'll have it on my Phone or tablet for the weekend. It's an outstanding Application and it allows you to watch multiple different areas in terms of what they have I think if you go, yeah, you go to watch live now. They're just teen They're just teen things off right now Excuse me one second But you can see that they actually give you a feature group. You can watch amen corner You can watch holds 15 and 16 you can watch the main group or you can watch holds four five and six They're showing people tea and off right now and you got uh, is that mike where yeah, mike weir He is minus one through nine leading things off. Gotta love the masters and we'll tie it into a little Financial aspect of the masters the winner 2.7 million dollars is what they'll be getting for first place second place 1.6 third place 1 million and 20 000 the interesting thing here is Because of the competition going on with live golf Where usually They're just throwing money the Saudis just showering money over everybody to try and wash over everything else They do in society a little bit of a sidebar there But what's interesting is the pga this tour this year has designated a few events this year with elevated purses of 20 million The masters only has 15 million So you got tournaments like the arnold palmer invi tent invitational the genesis invitational and a few others That actually have 33 more money than the masters, but guess what they don't hand out green jackets, man There's only one masters you gotta love it and I think this is jim nance last masters. Yeah, he did like the What did he do? He did the last march madness. He's doing the last masters Um and something else I think as he wraps it up But nonetheless the masters this weekend and uh folks, thanks so much for starting a trading day off basil Did his show at 8 a.m. So that's coming up right now Have a great long weekend. Have a great Easter folks. Stay safe out there. We look forward to seeing you back Monday morning Stay tuned for basil's program. We'll be right back folks