 Hello. Good evening, everybody. Once again, my name is Ali Hmedi, consultant for TechMill on their webinar series, going through what futures are and explaining how they work in the market. In this evening, as we've done over the last few webinars, we'll be discussing a specific sector within the futures that are offered, it will be the S&P 500 index today. Just like the last few webinars, we've discussed other various sectors from energy and metals and agriculture to interest rates, and we'll be discussing the S&P 500 index this evening. And as we speak right now, the S&P 500 is trading at $41.19 and a half, and it's about flat on the day. So it's been very volatile for those that are paying attention to the markets, obviously over the last few weeks, it's been a very volatile year for that matter. But with the interest rates increasing and so forth, it's creating that volatility to increase and provide opportunity as well as ways to protect yourself depending on what type of portfolio you are running and managing. To get into tonight's webinar, as I discussed, you know, we're going to be talking about the S&P 500. This chart here gives us, larger for you, gives us an indication of how, since its inception, the S&P 500 has done. It's updating back to 1920s, here you see here, the Great Depression, and all the way through the years, where it is now from its inception, it's plus or minus 12%, 11 and a half, 12% increase the S&P 500. As you know, year to date, at the time of putting this together, the S&P 500 year to date is down 13%, 13% or so percent, it's been down as low as 21% on the year. It's made somewhat of a, let's say, a bullish kick, if you will, over the last three weeks or so, mainly the last two weeks, last week of July, it's made a surge based on the earnings from several tech giants, Apple and Google and so forth, beating expectations, which in the tech sector, we'll discuss further and later on in the webinar this evening, but the way that the S&P 500 works, it's based on weighted capitalization. So the most weighted capitalization by sector in the S&P 500, number one is the technology sector, number two is the healthcare sector, and number three is the financial sector. So whenever you get positive or negative news coming out of the tech sector, it's going to show up and the activity immediately on the S&P 500. But this just gives you a graph here of sense and section how it's done over the last, you know, close to 100 years plus or minus and throughout its history. What we're going to be discussing tonight are outlooks. And before we get into outlooks at the time of this particular slide yesterday put together. So this is the current ES or the S&P 500 mini contract. I was trading in 360 for the month of June 2022. And it trades, you know, get four contract cycles on the S&P 500. You have March, June, September and December. So you got four months. This is the September. So if you look at the current one, as of yesterday, it was priced in at 360 spot 40. In December of 2022 futures contract was trading at 360 134. And if we go out to June 2023, it's trading it, it was trading yesterday at 360 178. So you're not seeing too much, let's say fluctuation in the futures price between the December and the June December 2022 and June 2023 pricing. It has moved quite a bit in the last, the index that is has moved quite a bit here in the last two weeks, mainly last week specifically. And now getting into the outlook itself and what it what what goes on and what's happening in the index itself, the E mini S&P 500, it has a contract size so we're going to have a refresher we've discussed this along with other futures contracts that are traded and future securities within specific sectors. If this if you can recall for those of the that have been following along the webinar series from the very beginning, we were discussing, you know what futures are and how they're used and what specific contracts are available on the tick mill platform and learning how to value each sector because each tick value varies from sector to sector. And as a refresher, I'm doing this refresher here because the E mini S&P 500 is the most traded futures contract in the market at the moment. So it has a contract size of $50 times the value of the S&P 500, it's traded on the CME that's Chicago Mercatile Exchange and other international exchanges it allows investors to hedge or speculate on the price movements of the S&P 500 index. And just as I mentioned it is the most actively traded to E mini contract in the world and contracts are available for March, June, September, December expiry days on each calendar year. Now the E mini S&P moves and their tick increments and quarter points, 0.25 point increments and each one of those increments equates to a $12.50 US dollar value, depending on what side of the trade we're on. But each way it moves for or against it's a $12.50 move and therefore a one point move or four ticks would equate to a $50 gain or loss. Now, at the time of this yesterday it was trading at 41.30 the S&P 500 right now is currently trading at 41.23 and a half. So, in the year day performance through through the end of July. So we're talking about last Friday today's Tuesday so we're talking to trading days to go a close for the first half of the year. In year to date it's down 13.89%. Now the S&P 500 all time high was at 4818, which was also reached this calendar year way back at the turn of the year and on January 3. The S&P 500 is a market cap weighted index I'm using that at the beginning of the webinar and the performance of the index is largest constituents will play a major role in whether or not the S&P 500 falls or gains further the remainder of the year. Now, tech I told you is the highest weight to the index, followed by healthcare and then financials. This is coming from Forbes and article out of Forbes. Now, I think that have been following along with where with my webinar series I like to provide bits and pieces of data information and analytical research analysis, etc. That's relevant to the topic that we're discussing throughout a broad timeframe, not necessarily been wanted to where we are today. And I do that for reasons so that, you know, for investors or traders looking to get into futures themselves we already know that they have a level of sophistication and needs to be understood properly, but at the same time, not to get carried away with the current news and the type of trend that the media will lead traders and investors, the narrative that they want to everyone to follow along with. So I go out and I find bits and pieces, just to let you know that there's a lot of information out there specifically when it comes to this particular security itself, the S&P 500 as an index, so that you're going to have a broad range of opinions. So this goes back to a lot of the you've heard you hear me say every single webinar you've got to be able to do your research and come up with your own strategy and so forth but when it comes to the S&P 500 it could not be more relevant not that it's more relevant than any others, but you're going to find a whole lot more of information out there on this particular security. And you could end up getting lost and you've really got to focus in and find relevance and where we are today with the current environment based on where we were historically. We are in uncharted territory. We can't say this is an exact, let's say photocopy of what we were back in the 80s or back in the 70s or back in the 20s etc. But we can take some correlations when it comes to interest rate, how did the market do raising interest rates, how did they do inflation, rising inflation environment, how did the market do etc etc. So from Forbes, you know they come out with a brutal start to the year the markets got only worse in June 2022 so we're going back now a month or a little more than a month. And the S&P closed out the first half of the year down 21%. So if you go back, you know, the markets pulled back plus or minus 8% the month of July. So at the time of this writing, you know they're talking about what happened at the end of June and it was down 21%, which was the steepest first half loss seen in more than five decades, leaving the index firmly in bear market territory. So we've reached 500 posted daily declines on a 56% of trading days this year, which is an about face which is a complete opposite from the trend over the prior decade when daily gains were more typical, occurring 55% of the trading days. So we have basically a complete shift and change or paradigm of what has been happening over the last decade as to what's happened in the first half of this year. A myriad of related factors explains the widespread route in the markets June saw another spike in key inflation and the key inflation report after prices have been rising at the fastest pace in decades. The Fed aggressively ratcheting out interest rates to tame this inflation, and there are continued supply chain issues stemming from COVID-19 disruptions and the ongoing war in Ukraine, all of which has contributed to increased worries of another recession is coming. Now, speaking of recession, the data has come out in theory, not in theory, and black and white terminology, we are in a recession because we've had now two quarters back to back with negative growth, which is the definition of recession, but you're going to have a lot of these analysts come out and say well this or well that, but we're not getting into what I think and why I think is better than what they think we're not going to get into that type of debate is just where we are and what's happened with the economy in the US specifically dealing with the S&P 500 index. And as you recall this came out at the end of June so one month has passed. This is from global investments. The portfolio manager's name is Tom Barton, and regarding recession so much attention is being paid to the timing and how bad will it be. And impact on stock prices are most relevant when thinking about the next recession, there are a lot of wall carbs going forward for and July offers a lot of good information for assessing the strength of the economy. When you have when you have increased uncertainty you want to reduce the risk you are taking in your portfolio. He also highlights that value versus growth with that debate growth stocks versus value stocks for much of the year value stocks were outperforming growth stocks value stocks are, you know, they're all large capitalized stocks in the S&P 500, and how you define or differentiate between a growth stock and a value stock is pretty much which one is paying dividends or higher dividends than others so companies that are paying no dividends to very small dividends are more growth oriented than companies that are paying higher dividends throughout their quarterly reports and earnings. This is from ax investments the CEO there is Greg Besuke. Now, this coming out at the end of January at the end of June apologies, we think July is going to be very reflective or similar to similar to what we have seen in June the uncertainty and volatility that's been happening in the market and the underlying factors, driving that are very likely to continue. As long as inflation remains a big topic, it makes sense to invest in inflation sensitive assets like commodities cyclical stocks that historically did well and prices are rising and tips which are treasury inflation securities. So, here we have this investment bank we have the CEO coming out in their forecast that after the first half of the year quarter end of June, expecting much of the same that happened in June to play out in July well here we are now today being August and we know that the market pulled back should pull back came back bounce back eight percentage points and you know has had a strong show last week and it's trading, you know right now it's up 10 points at 4128 back to almost the time that when I made this slide show yesterday. So, you can see the, I don't want to call it discrepancy but the differences of, you know, what financial firms and analysis come out with based on their narrative and their strategy of what and how they are dissecting and saying the market. So, you know, here he comes at the end of June saying we're going to see the same type of market volatility in behavior that we saw in June, and the reality of it, it just wasn't the case. I found an article from markets. Business Insider.com with a bank from an analysis from Bank of America, the S&P 500 could fall another 23% from where we are now in a worst case scenario as the stock market prices in one third chance of recession says Bank of America. Okay. The S&P 500 could tumble to 3000 by the year end of 2022. Now note, this would have the S&P 500 down approximately 37% for the year 2022. This article came also at the end of the first half of this year, end of June beginning of July. At that point in time the market was down 20, 21%. You had another 23%. Well, I'm sorry. The market at the time of this was down 18% when this article came out. So, you know, you're looking at another 30, it could be a total of a 37, 38 rounded off to plus or minus 40% drop for the S&P 500 overall for this year calendar year in their worst case scenario. They're not saying that this is going to happen. They're not forecasting it, but they're forecasting a worst case scenario that they could see the S&P 500 drop down to the 3,000, maybe 3100 level from where it is now, which would be a 1,000 point drop 1,100 point drop from where it's trading right now. Analysts pointed out that the current bear market is the 27th bear market since 1929 and historically they have resulted in a 35% average decline. This falls in line with B of A's worst case scenario using its equity risk premium framework. So they have their, let's call it software that they use to work on the analytical and the numbers and the data, etc, etc. What, from a historical sense, when a bear market is in play, what they're saying is that the average result is a 35% decline in the market. And if you took, if you take it from the time of when this article was was printed and released in their factoring in a 37% worst case scenario drop in the market this year. Well, it's, you know, 35, 37 that's close enough for it to fall in line with the previous historical data of the 27 bear markets that have historically happened. Now Bank of America recommended staying long on on the energy sector and avoid consumer discretionary stocks pointing out that energy has outperformed the S&P 500 this year by 44%. Now, how is this possible? Well, this gets back to what's going on geopolitically and within the commodities sector specifically, we saw oil spike up and we're still seeing the ramifications of high gasoline prices in the United States and worldwide for that matter. So you can see how energy stocks, you know, Exxon, Chevron and Shell, they all are reported earnings over the last few days, and they all beat estimates by a lot. They've made billions of dollars in the last quarter combined if I recall it was close to, I think 40, 50 billion dollars between those three conglomerates, they were profitable. You can see now how that 44% beat of the market took place or is taking place. This is from Yahoo Finance from this is a technical analyst. This is a technical analysis article that came out in July 1st. So this is also dated one month just to show you how things play out. So if you read something that's dated today that doesn't necessarily mean that it's going to be accurate or 100% true or false for that matter but this is why I give this information and discuss the outlook in an informal discussion. This is from Christopher Lewis. The S&P 500 has gone back and forth during trading sessions as we continue to see a lot of lackluster performance in this market. Ultimately, I think this is a market that goes lower, perhaps trying to test the 3700 level, which we've broken by the way, rallies at this point are to be sold into at first signs of exhaustion. Now, what that means is we're considered in a rally based on, okay, if 3700 is level, we're 400 points above that. And if you start to see a kind of spotter where today's trading flat, you're not seeing a large increase in percentage points on the day to the upside, but if this were to continue, let's say day in and day out and starts to get tiring, that's what he means by the exhaustion of it, then sell the rally. That's what he means by that and he believes that it's not until we break about 4000, the 4000 level that you can take or take it really as being serious. Now, if we break that level, we could overcome a large round psychologically significant figure, we would take out of the 50 day exponential moving average. That would be bullish, perhaps sending the market up to the 4200 level, we were not too far away from the 4200 level as we speak right now. A break above the 4200 level obviously is a very strong sign as well and at that point I would consider buying until then the markets need to prove itself to me, meaning him, or the Fed needs to change its monetary policy. So, right now the Fed hasn't changed its monetary policy, they're still tightening, and they're still shrinking their balance sheet interest rates are still rising to combat inflation. But, what has happened specifically over the last week is that earnings reports coming from the tech sector mainly have really given a push, a big push to the markets because Apple beat expectations significantly. As did Google and other in the technology sector. So, whether they did well or not, but they're beating expectations is what the market's looking for for any signs of positivity as a signal to say okay, is this the bottom or have we reached a turning point for us to get back in or what. So, based on this this is one month old from this technical analysis, analysts, and we're right about that level where he would consider getting back into the market, feeling confident that we are back in a bullish trend, and not in a bull trap. Okay. So, CNBC.com, Tom Lee at Fundstrap. Now I'm going to give you some of the other side where he already has come out. So, CNBC and other outlets as well but he's already saying that the 2022 bear market is over and stocks could hit new highs before year in. So, you, you saw the worst case scenario that Bank of America and their research provided, and now we have another highest in the market, well known at Fundstrap, it's coming out saying it's over and you know I'm predicting all time highs by year in, we had an all time high at the beginning of the year and beginning of the year, and he is also saying that we could reach that level or by year in. Leading indicators show that the CPI will be under 2% in six months, the CPI is the consumer price index, which is the inflation rate, right now it's at 9.1%. And that's what the Fed is trying to take head on by raising the interest rates, but for it to come back down to 2% within six months, that is very aggressive. It's taken the course of where we were at the beginning of the year to get to 9.1% in six months for it to come down further than where it was at the beginning of the year to get back to where the Fed is their advantage for inflation, which is two to two and a half percent within six months is very aggressive. So, and he's seeing that the S&P 500 by year in would be above the 4800 level from Citibank. They're also in line that when they say overweight in US equities they're going back in taking long positions they're taking up positions in the market within companies in this particular index specifically S&P 500 and they feel that they are confident enough to take these positions because they feel that there is a market shift and turn around for them to do so. Now, from several others you have Ritt holds wealth management Morgan Stanley JP Morgan UBS, you know common staples or, you know, household names if you will within the financial markets. Josh Brown CEO, you know he comments, I don't think the Fed has the appetite right now of getting gasoline prices down to where they've worked so hard to get it down that they would invert the yield curve deliberately if the Fed shrinks the balance sheet it will negatively affect stocks. So basically he's saying now, the market is in the court of the Fed. Okay, the Fed has the ball in our court. And if they continue the monetary tightening and the, the raiser the rise and in rates. So we're going to create this invert yield which gets back to a couple webinars ago that we had speaking of interest rates where, if you have the two year Treasury, the United States Treasury bonds which are considered, you know those are the bench for the risk free rate of return. So your two years trading, as it was just a couple of days on Friday it was trading at 270 if I'm not mistaken. Okay, 2.7%. Okay, for a two year US Treasury that means you would invest in that bond and you would receive 2.7% interest for a two year time Now, go to the 10 year, the US 10 year. What kind of yield or interest was it providing. It was at 2.8. So if you think about it, you know you can get a two year US Treasury for 2.7%. Why would you buy the 10 year for 2.8%. Okay, and if you even go up to the 30 year the 30 year was trading at maybe 320. If I'm not mistaken 3.2%. So you can see that's what he means by the inverted yield curve where the short end of the Treasury curve is yielding higher than the longer end which in theory it shouldn't be the longer you hold an investment the more return you should get in the shorter investment the less return you should get the CIO Lisa shallot from Morgan Stanley the chief investment officer. A recession could likely be shallower and less damaging to corporate earnings this is coming from Morgan Stanley than recent downturns damage to corporate earnings tends to be more modest during inflation driven recessions compared to credit driven recession seeing during the great financial crisis and the dot com bubble. So her point here is getting back to what happened in 2000 with the dot com bubble in 2008 with the great financial crisis where those were credit driven crisis or crises. So here this is inflation driven she's alluding it to being an inflation driven, and it will not be as severe, meaning it's going to be shallow than expected, and the damage to the corporate earnings will be more modest than severe. When they come out which has been the case with we saw last week with as these corporations, you know we're in earnings season right now from JP Morgan. The analytical team in general they hold a positive outlook for the US financial sector now their speed speaking specifically about a sector here so that we don't clock the whole S&P 500. In this particular but I'm pointing out the US financial sector is the third largest weighted or weighted third large weighted by cap in S&P 500. Hold a positive outlook for the financial sector they stated that banks have historically performed well under inflationary conditions, which we're in right now, but it's have suffered during recessions, which we are also in now if you look at it from a black and white perspective. Higher inflation and slow but growing GDP is a good environment for banks. Now, we are in high inflation. There, last week there was good reported good reports from the earnings, but growing GDP, you know, where we were flat to slightly negative, which that gets back to the technical terminology of whatever session would be. So, they, they're pretty much in the ballpark but they're focusing their attention on the financial sector with this particular data from UBS UBS, they did not give any forecast or predictions for the remainder of this year or beyond. But they did advise that if equity markets were to see a further slow at a level down to 3300 investors can improve resilience of equity portfolios by investing in value stocks and healthcare so getting back to value stocks. They pay higher dividend and healthcare is the second weight, the second largest by weight cap in the SP 500. So their target for, let's say getting back into the market would be the 3300 level for the SP 500 index. Key takeaways, what we want to look at from where we are today what we've seen the first half of the year for six months and then what happened in July and then what we're going to be going through for the remainder of the year. We're going to look at the SP 500 forecasts, the important it is very important to keep in mind that the forecast and price targets can be wrong. So I just gave you throughout this webinar so far, a wide variation of, you know, we're going to be at all time by the end of the year to worst case scenario we're going to look with by year and we could be down 35 to 40% year to date. And that's a very big range and anything in between is fair game. So this is why I say, when you build your narrative and you build your strategy, and you are going to use this particular product with future in the futures market. You can, you can do very well from a hedging standpoint. And if you speculate, you've got to put in the parameters to protect yourself in case you don't get it right. You can speculate and you know, pick any of the choices and anything in between that I just mentioned tonight, and that resonates best with you and your mentality and what your thought process is, is, is giving you. And, but if you're going to speculate, put in your safety measures, you know your stop losses don't be greedy. When you do have, you know, when you hit your target of profitability, get out reassess and see what's happening. Analysts provide both ends of the forecast spectrum from dropping further to reaching approximately a 40% downfall on year to reaching all times high, all time highs which I just discussed. And as always, you've got to do your research. This particular, this particular security is the most traded security in the futures market, the e-mini S&P 500. So you're going to find a lot of information out there. So, by no means keep your, do not keep your blinders on and find, you know, that one bit of information or analysis that you want to believe in and ignore the rest. You've got to be able to, to look at it candidly and objectively and say, okay, how many analysts out there fall in line with what I'm thinking and how I'm trying to build out my portfolio or protect my portfolio, and just put it on a spreadsheet and see, okay, well, out of all of the X amount of research that I've done, and looking at from a technical analysis from a fundamental analysis point of view, 30% fall in line with what I think 40% on the other opposite end, and then you've got 30% somewhere in between and that will give you some sort of gauge of, you know, how accurate or inaccurate analysis may be. And then getting back to point number one on the key takeaways is that nobody knows where it's going to go. You know, you have people, you can see them on TV, you can see them through articles, or, you know, any type of financial information outlet and you'll see people so adamant that, you know, this is the end or we're going to go into a session it's going to put us possibly into a depression by 2024 to 2026, and you're going to see all kinds of stuff out there. And you've got to be very careful, because when individuals get out there and they they are or train their forecasts and their analysis. It's because that's what they firmly believe in and they they are dealing with institutional money, and they are positioning institutional money you're talking hundreds of millions to billions of dollars, based on a particular strategy. And what you're listening to is what their strategy is for the market, most often more than not is in within a short time from you're talking anywhere from one quarter to maximum two quarters worth of money management because they're very dynamic they're going to buy and sit on something and just let it sit until they say oh okay well I've had this position for years. Now it's time for us to do something with it so you've got to understand the mindset and what the investment policy of these investment banks and analysts are coming from, so you can't just take it at face value and say, okay, I like what he said I believe it makes sense. Let me go take a position, you know, because unless you're an institution and you're managing hundreds of dollars, you know, chances are, obviously they are using futures and options these exchange traded derivatives that are sophisticated and they understand how to protect themselves and that's what we have to do. As always, I like to leave with a quote, the biggest risk of all is not taking one. Now, it's always be it's always easier to come out and say something in hindsight, especially if you didn't do something or if you did do something and say yeah I should or I would have if I had done that or do this back I would have had a whole lot more money etc etc. Yeah, if we all bought Bitcoin back in 2010, we would all be in a different situation now, so that doesn't really help. Okay, so don't get that what I'm getting at here is if you're going to take risk, which if you already have an investment portfolio. So, there is risk involved, because financial markets do carry risk futures are a sophisticated product that allow you to enhance your portfolio performance, as well as protect the portfolio that you have. If you want ways to protect, and you want a sophisticated way to speculate within parameters. This is an opportunity for you in this type of environment, specifically with future securities. This came from Melody Hobson. She's an American business woman she's the President and CEO of Aerial Investments and she's also the chairwoman of Starbucks, Starbucks Corporation. So, with that being said, right now, the S&P 500 is up 16 and a half points trading at 4135, slightly up on the day, and, you know, we'll see how it does the remainder of this week as earnings continue to come out through several sectors in the market. With that being said, I'll open it up now to any questions if anybody has any questions, please feel free to send it to me on chat, and I can answer them the best way that I possibly can. Any questions? Go on once, go on twice. All right, everybody have a very good rest of the trading week. Stay sharp, stay focused, do your research, and Tick Mill will be getting back in touch with me and everyone else when we'll be continuing. I'm going to be pushing to see if we can continue the market outlook within the future series again next week, and we'll keep you posted. And this will also, this webinar will be up on Tick Mill's YouTube platform as well for you to view later on on your own time. Have a great evening. And thank you very much. And we will talk later. Bye bye.