In today's episode, Kip is diving into the latest market movements with a keen focus on overbought markets, the impact of the recent China stimulus, and the sectors we have our eyes on. Kip also covers our "roaring 2020s" theme, highlighting the rise in equities, real estate, bitcoin, gold, silver, and more. Tune into today's podcast to learn more.

Don’t look back. The market is closed. Good Thursday afternoon, everyone. Kip Herriage here with the daily VR investing podcast. Hope you had a great day out there today. Good day in the markets today. Futures were high overnight. Good internals today.

We’ve got some overbought markets to talk about. Walk you through that, how we’re approaching severing, dusting system sectors we like. Let’s get right to it. Big more China stimulus overnight. KWEB, the China Internet ETF that we own up, it’s only up 22% in three days. So it is up like 35% in three weeks. So yeah, China is back, especially chinese tech stocks we’re looking at as a trade, frankly. But it could be a really good trade.

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We’re not even, not even considering selling yet and taking profits. I think China’s got a long ways to run with the whole global. Isn’t this the theme? This is the theme, is it not? This has been our theme, the roaring 2020s. Unbelievable amounts of global liquidity. Stocks have to go higher. Inflationary assets must go higher. That’s equities. That’s real estate.

That’s housing, that’s bitcoin, obviously, that’s gold, silver and the miners. This is a kind of becoming an everything bull market. But before I forget to say this, let me go ahead and say it now. In my experience, not a prediction necessarily, but in my experience, when we get this kind of a train leaving the station and doesn’t it seem really easy to make money when we get this kind of feeling? And that’s the feeling we have now, is it not? When everything starts going up? That’s the feeling you have. I’m seeing it on Twitter. I’m seeing people bragging about their game. These are the signs, folks. These are the signs, right, that we look for and combined with what we’re seeing in the very investing system where now every index, every index is a stone’s throw away from extreme overbought.

It means we’re right there at extreme overbought on steroids. Small caps are not, semiconductors are not. But the SPF 100, Dow Jones, Nasdaq, the qs, all hitting extreme overbought, which means we’re extreme bottles of steroids. When all of our momentum oscillators are extreme overbought and everything else lines up again in the various system. We published most of those reasons then that means that’s when bad things happen. That is just when bad, that’s when bad things happen. That is when bad things happen. And so we’re not saying take profits at this point because we believe that this rally is going to be pretty, pretty big into your end.

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But this is when we pause our buying. This is when discipline matters. And hey, we’re not selling. We’re not selling. But if we miss out on some gains that we could have had had we added to our positions here, then so be it. If you’re a trend follower, our approach has always been let’s make that 80%. We’ll give the other guys the 10% on the top and the 10% on the bottom. So we’re not picking tops and picking bottoms.

Give the, the rest of the market that we want to make that, that 80% in the middle. That’s the safest money. So that’s where we are right now. That’s our approach. And we’ll let you know when something changes. Be we’re right there. It doesn’t mean we can’t get going. These markets can get extreme about on steroids and stay there for a week or two or three, but you’re kind of living on borrowed time.

From a short, from a trading point of view, if you’re, if you’re purely a day trader, this is when you’re taking profits. Yeah, you might wind up giving away some money you could have had. But if you’re a short term, real short term trader, this is when you’re taking profits. We just take a bit of a longer approach with our investing. Again, we’re looking for much bigger gains in the year end. And if we could go back to the, when the semis melted down, remember the semis fell 28% from the highs in July, 3 weeks from, from the highs in July into August. The August 5 bottom 28% three week bear market in semis. Just crazy, right? But it spelled and acted very much like what we’re seeing.

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What I saw in the.com melt up in 95 to 2000 because again, we cover this often. But that happened five times where we had corrections of ten to 20%, including one bear market of three months. It took Nasdaq down 32%. And that was in the final home stretch. That was right before the bottom over the last 18 months of that historic move higher where Nasdaq went up 170% in the final 18 months. And that’s when it was really fun because that was truly a parabolic move hire. So, you know, look, trees don’t grow in the sky overnight. You’re always going to have shakeouts.

You have to do that to get rid of the froth. You have to do that to get the hot money out. Right. The hot money always comes in last, and then they’re first to sell. And so that’s when you get volatility at some of these tops. Right. So again, that’s, that’s our approach. And, you know, we’ll be running our screens and see if it makes any sense here to start looking at putting stops in or taking some profits.

October is the worst month of the year in election years. All right? And so right now, we’re still in that. We’re still in front running mode, right. The smart money, we started covering this like a week and a half ago, right? The smart money started bought. That’s us. Some, our money started buying some time ago for a lot of reasons. But really, as we started talking about like a week and a half ago, how long would it take before Q four front running started and boom, just like that, the market started moving higher. Right.

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And these dips are just being bought very, very quickly. That’s a sign, right? That’s good. Smart money hours. These are all signs that serious money is buying the so called smart money, which is typically central banks. You know, even though many of them say they’re not allowed to do that. The plunge protection team is very real. It has, we have one here, there’s one in Japan, they admit theirs. China, they admit theirs.

Europe, they have admitted theirs in the past. So only the US has not admitted to having a plunge protection team. But that means that they’re active in equities. And so we need to, you don’t want to be on the wrong side of central banks when they’re acting. You want to front run them, right? Think about all that. Think about how fast interest rates went up when inflation, remember transitory, we don’t have it. Transitory. And oh, my God, it’s 41 year highs.

It’s from the best Federal reserve ever. If you listen to them patting themselves on their back and basically saying mission accomplished for the job that they did, they created the problem. Then they’re also the firefighter that puts the fire out. And then they want to be, get pay raises, be congratulated for it. But when rates started spiking higher, that was all the big money. That was all the big money getting front, getting out in front of the Fed. And now this happening in the reverse end. It was, right.

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Remember the ten year hit 5% last October, 11 months ago, and then spiked all the way down, 3.6 or 3.79 now. But again, that was the smart money. That was the big money front running the Federal reserve. And what they were going to be was just slashing rates. Now, of course, China has done it with their big bazooka again. They have more of that overnight. So the world’s awash in liquidity. October is the worst month of the year.

In election years, October surprises, bad things tend to happen. I’m going to write some of this up tomorrow, because look around the world. What’s happening geopolitically, specifically on the war front, on the warmongering front. We have to see every day what’s happening between Israel and the Middle East. I mean, it seems like they’ve got a new enemy that they’re bombing or invading every day. I’m not making a judgment. That’s just the reality. And then there are counterattacks from both sides.

So there is a lot of Putin just talking about the possibility of using nuclear weapons if the interior of his country starts being bombed by cruise missiles or anything else. Maybe a wave of drones. Right. Said the nuclear option is something we’ll have to consider. So there’s no shortage of shocks to the system. That could happen just a month and a half ago, or a month ago, we had the japanese black swan scare, right? Where the trades, the trade that everyone’s used, the carry trade everyone’s used there, fell apart, the yen carry trade. So they sent japanese equities down 13.4%. They had their black money when that happened.

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And that, of course, rolled over towers in the morning. So I think what I’m saying really is this, this is not a time to be heavily exposed on margin. This is not a time to have your last dollar invested or adding two positions, in our view. And again, that’s just the discipline we have here. And I have to mention, I talked about on Charles Payne show yesterday, I’m seeing a lot of people, again, that are bragging about the money they’re making. I’m seeing a lot of people that are now coming out and saying, oh, yeah, this is, it’s a melt up. Here we go. And, like, I don’t remember you ever being bullish.

You’ve always been bearish. Now all of a sudden you’re a bull. And now you’re saying, oh, I was wrong, but here we go again. These are signs of tops. These are signs of short term tops. So again, we’re going to run all our screens tonight, and we’ll write it up for all of our subscribers in the morning, what we’re going to be doing here. But again, just as time, just to start using caution, not to be not to overstate it, but I cannot tell you the number of times that this has happened where I regret not being a better communicator of where we are and what the risks are. Because extreme overbut on steroids is when bad things happen.

Not a prediction, but it is reality and it’s something we should all be thinking about. Right? Stops are great for situations like this. And you never go taking profits either. So there’s nothing wrong with that. We always get shakeout. You’ll get, I promise you, you’ll get a chance to buy, to buy what you want at a cheaper price than it even is today because we will have shakeouts. Unless this is that melt up parabolic move higher into your end, which is also very possible. We’ve talked about the reasons why that is.

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Someone wants very badly to get misses Kamala Harris married to get her, to get her elected as president. Right. A big group wants to do that. And a melt up stock market with a strong economy, that sends a pretty good message for the current people in office. So again, there are a lot of reasons for this market to keep going higher. Conspiracy theory and otherwise. But that’s it for today. Let’s talk about the markets now.

Dow Jones said they finished up 260 points. Good day. Dow Jones was our leader on the day. Barely, just barely, beat out Nasdaq, up 0.62%. Next up was Nasdaq, up six tenths of 1%. Exactly. Up 108 points. SBI 100 up four tenths.

And Russ 2000 up six tenths of 1%. By the way, Russ 2000, small caps, the only group, the only index that is not hitting extreme overbought levels. It’s the only one. And again, the semis aren’t there yet either. Let me just check the miners real quick because they’re getting close. And they were up again today. Yeah. Again, we’re knocking on the door of extreme web bottom steroids.

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We’re right there. And again, it doesn’t mean we can’t keep going higher. Some of the most explosive moves take place when people don’t expect them and we’ll need an extreme or bolt level. So just an observation, making sure that we fully communicate both sides of what could happen here. Right. Okay. Let’s take a look under the hood today. I want to talk about one other thing today.

I wrote this up this morning. Semis. You know, we love them. We’re, we’re loaded for bear with the semis here. Again, it’s the cheapest, the best looking chart that we see outside of the well different charts than the miners, but the semis are still folks, believe it or not, they’re up big again today. But the semis are still. What is this? 1010 percent below all time highs. SMH today was up semi.

ETF today was up 2.7% 2.8%. So the semis are still going to be like eight, 9% below all time high. Great looking chart. I encourage you to take a look at the triangle that it broke out of. And again, just, it’s reaching overbought levels but it’s not as close as the others are to being extremely bought. I. What else here? You know, we love the miners, of course we have for a long time. Let’s go ahead and move on though.

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Talk about the internals. Good internals today as well. We had a trifecta positive across the board as you would expect on a day like this. Advanced decline for NYSE was 1.7 to one. Advanced decline Nasdaq almost two to one. Up volume for NYSE 69%. Up volume on Nasdaq 72.4%. These are all good numbers.

And finally, new 50 kaise lows came at 540 to 148. Intersector watch also pretty good here with seven sectors finished higher, four finished lower. Led the upside by materials up 1.9%. In this combination of lower rates, resumption of the bear market in the US dollar, central banks buying this will be a third year in a row. They buying record amounts of gold and then base metals like copper catching fire as well. So yeah, material is doing very well. Almost 2%. Technology of financial of half percent.

The downside, energy. Oil is the one commodity that’s not benefiting yet from this China money bomb stimulus bomb they’ve unleashed. But it was down to damn fairly big today. Otherwise fairly quiet. Elsewhere in our commodity watch today, gold up dollar ten announced again it traded over 2700 for the first time overnight. Closed close I’m showing you right now. It closed at 26.95. Announced silver hit a the third, the second highest, second highest price it’s ever been at.

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Can we have the big spike to 50 right now? Silver after hitting 33 announced this morning backed off a little bit. Still finishing up nine cents. One percent at thirty two point three one an ounce. Copper again on a, on a tear up three and a half. Doctor. Copper at three and a half percent today at 4.65. We told you eleven in the pullback. We just don’t have a copper miner that we love then we’re already loaded well with the gold and silver miners.

So that’s what we’re sticking for now, crude oil again, getting hit here, down $2.24 a barrel. That’s a 3.2% today to 67.45. And finally today, our lovely bitcoin, which you’ve been watching it. You know what’s been going on today. And today bitcoin hit 65. 65 and change. Right, 60. Hold on, let me get the exact.

Yep, 65. Almost 66. And now it’s back off a little bit. The 64,700, that puts us like $9,000 away from an all time high. We’re really starting to get to the point. If you look at a chart where these downtrend lines, we’ve had a series of connected lower lows and lower highs. And to break that pattern, which is a been a pretty, pretty well entrenched pattern, you need to break through that higher low, the higher, higher high pattern and then start putting in some higher lows. That may be.

We’ll run our charts again tonight. That may be happening right now with bitcoin trading where it is now. And if that’s the case, I think you’re going to see, again our target’s been 100,000 bitcoin into year end. It was looking a little iffy. Will we get there if we get there or not? Yeah, I think that’s back on 100,000 by year end. 250,000 is our two to four year price target. Again. These moves, I think, are going to start happening pretty quickly.

So much bitcoin has been taken off the market. It’s the best supply demand story there is. This has been a story we’ve been repeating for a very long time, so forgive our repetition. But, yeah, you gotta. Gotta own bitcoin here, but it’s in everything bull market. And you also got to check your charts and make sure we’re not hitting overbought levels that could hurt you by putting new money to work. Right. All right, folks, that’s it for the day.

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Hey, I hope you had a great day. And you better night. We’ll see you back here again tomorrow after the close. Bye.