Welcome back to the VRA Investing Podcast! It’s a jam-packed Wednesday as Kip Herriage returns after three days away with an in-depth market update. Today, Kip Herriage breaks down the end of the market’s nine-day winning streak, why he believes this is a "buy the dip" moment, and how the VRA System signals there’s plenty of room left in this powerful, long-lasting bull market. He covers headlines from a parabolic surge in semiconductors and AI stocks, to the impact of global events on oil and rates, and the market’s anticipation for the SpaceX IPO. On the company front, we get updates on Tesla's breakthrough robo-taxi rollouts in Austin and promising news for Lost Soldier investors. Kip Herriage also unpacks the latest in Bitcoin volatility, gold and miners, and why retail investors may be selling the recovery short. Strap in for a fast-moving, insight-packed episode that puts the week’s major financial headlines into sharp focus!

Don’t look back because the market is closed. Good Wednesday afternoon everyone. Kip Herriage here with the daily varying investing podcast. Hope you had a good day today. I’ve been away for three days, just back in the office here a few minutes ago. But we got a lot to talk about, a lot of fun things talk about. Of course, the, the streak ended today.

Well, we had nine straight days up. Every day the market had been up. Not every day since Kevin Wash was sworn in as new fetch here. I don’t think that’s an accident. I don’t that I think we can expect a lot more of that. I think the fact that we broke our upstreak today, it’s going to be, it’s gonna be a buy the dip opportunity and we’ll cover all that. More talk about the very investing system where it is right now. Some various things there that just don’t indicate we’re anywhere near a top.

Yeah, semis have gone parabolic. Right. AI infrastructure plays have gone parabolic. But folks, that’s just a snapshot of what’s to come. This is, this market is going to be so much more powerful, longer lasting and broader than dot com was. We’ve seen all the evidence of that. Again, we’ve been talking about this for four years. Others are starting to pick up what we’ve been talking about.

But I think we were right four years ago. I think the evidence proves that up. And I think we’re also going to be proven right that this bull market’s going to run for a very long time. And so again, this will remain a buying opportunity. The VRA system proves that up. We’ll cover that in a moment also. And talk about the war again. That’s really, that’s we were extended, of course, we’re overbought for sure.

But this, this is all, this is really all this decline today is all about oil, which means the war, which means oil and rates. We’ll come back to that as well. Some interesting things I’m seeing in the precious metals and miners Tesla big news today if you’re a lost soldier, investor if you know the story. Got some news for you on that as well. The economy is rocking and rolling. Going to talk about that a little bit. I’m also by the way going to be on Wayne Roots show tonight at 5:30 Central. Dig into some of our favorite mega trends and primary trends that we’ve been talking about with you here.

Con, again, economy is rocking and rolling. Let’s, let’s get to it. Again, the Decline today. Dow Jones down 620. That led lower. Nasdaq down 9/10 of percent, down 239. SB 500 down 56 at 7/10 of a percent. Remarkably the semis which you know, if you follow our work, that’s the key.

The semis have been the leading indicator for the broad market direction since just after quantitative easing. I know this because we’ve been talking about this with you in our very letters since then, since I first noticed it in about 2011 I think it was. And that is that, that’s the semis are the best tell there. There is no better tell. Now we have some other liquidity tells as well. So I just. Semis. It’s bitcoin.

Bitcoin’s been been disappointing of late. I will talk about that a little bit as well. Gold has been disappointing of late, miners as well and I think that’s really tied to the war. But the semis continue to lead higher up another nine tenths of a percent. Today again semis testing of 100. That relative strength chart we talk about here a lot with you continues to go parabolic. That that’s really important. Look, if and when the semi start leading lower and look it’s not going to be straight up.

Now I think we all know that during the dot com melt up we had five declines, the corrections if you will, five corrections of 10 to 20%. Five of those including one that was a 31% bear market that took place in three months and everybody thought it’s over. That was 18 months. The next 18 months were the real melt up move higher in dot com. So I think, I think it’s smart to pay attention to what matters most as far as when the market’s ready to take a breather. And look that can happen anytime. We’re pretty good, but we’re not that good. So that’s why we watch things like the semis, watch the internals, watch our liquidity tells.

And again right now we’re just not seeing any evidence that one of those moves lower is about to happen. We’ve been saying now with you for about a couple weeks that we believe that this melt up move higher, which is what it’s been, was going to continue into the SpaceX IPO on June 12th. I still think that’s the case. Again I’ll be surprised. Unless this war really starts to heat up again. I’ll be very surprised if we see another day like this. I think these, I think these dips into this basics IPO are going to be short lived and they’re going to be buying opportunities. And the primary reason I say that is the markets love to key off.

The markets love to key off big events. This is the biggest IPO in history. It’s certainly a big event. And again, they just priced it today. I think I saw Elon Musk priced it. SpaceX IPO 135 and going to raise $75 billion. Everyone Tyler covered this yesterday. Everyone’s talking about these massive IPOs.

Well, I mean they are massive. SpaceX, SpaceX anthropic and OpenAI. Yeah, they are massive. But the total amount of money going to be raised is about 300 billion. It’s not a small amount of money. But again, remember, in the big scheme of things folks, and this is one of our, our big three, right? Trump economic miracle, innovation revolution and this absolute Ocean of liquidity, $8.2 trillion in money market funds, it just keeps rising. Even as the market keeps going up and people are taking money out of it and putting it into the market, that number just keeps rising. Absolute ocean liquidity, $22 trillion it empty money supply.

Right. Again, these are all time highs, absolute ocean liquidity. So the 300 billion is a big number. Is it going to, is it really going to drag that much money out of the stock market and other positions and it’s going to be like a little pebble in a big lake. You might see a ripple effect for a day or two, but I think that’s going to be it folks. This is that bull market and I think this is going to be that bull market year. We’ve said it now from the beginning of the year. This will be the first year that the innovation revolution really arrives on Wall Street.

And that’s been outside of the war, right? That, I think that’s been, that’s been the right call. Matter of fact, it has been the right call. But again, I’m being repetitive. I think these dips will be short lived. This is about the war. We know Trump wants it over with. We see it every day in the interviews. He does, he does so many of these.

How does he, I don’t know how he does it. He always says the same thing. I, I think we’re close. They know what’s most important to us, what can’t happen. Nuclear material, nuclear production. And, but then we see, you know, these, you know, Trump calls them defensive attacks. I think it’s a little bit more than that now. I think, I think it’s, it’s pretty obvious that there’s, there’s really not a ceasefire.

It’s, it’s limited. Both sides are sending a message, but Trump wants it over with. When Trump pivots, he pivots. And he said just this afternoon after the close that he thinks they’re close to getting a deal. But we’ll see. But again, what happened to oil spike today? 96, what happened to race today spiked 4.49%. Still below the 4.7. Whatever percent of the war highs.

But again, that this is what should concern all of us. If the war kicks up again, oil goes higher, rates go higher, we have a problem. I just don’t believe that’s going to happen. However, I will say this about oil prices. I’ve been pretty vocal about this. The oil prices were going to keep going lower. I’ve said 80 within 30 days, 70 by year end. I’m, I’m not so certain of that.

Now. If this goes, if the, if the straight remains semi closed, and that’s, that’s really what it is, semi closed, oil prices are going to stay higher than I, I really think they are going to stay higher. But I don’t know that that’s a problem. Matter of fact, I don’t think it is. As long as we don’t get 105, 110, 120, you know, steadily over 100, the markets are going to keep looking the other way. We’re seeing it in all the data right now. See in consumer spending, we’re seeing in all the economic data, the economy is on fire, 28%, by the way. I don’t watch a lot of TV, but I, I cover social media pretty, pretty carefully.

Do you see a lot of people talking about Q and earnings coming at 28.5? Because I don’t, like, I, I don’t see that. I think people are aware of it, but they’re not talking about it. How’s that possible? Is it just because it’s just tds? I can’t think of another reason. I think it’s just TDS and people just, they don’t want to think it’s real. They don’t believe it’s real. It’s real. Again, we, we said 18 to 20 earnings earning per share growth, S500 at the beginning of the year. Even we’re on the low side, I think, I think, I think 30% plus is gonna be for the full year.

[00:09:37]:
And that absolutely means we’re gonna have a 5% GDP rating, I think in the near term, again, some point in the next quarter, some point in the next three months. I think that’s a lock and that’s what drives the markets. Corporate earnings and GDP growth is what drives the markets. That’s all about supply and demand. And again, we’re just not seeing the economy being hurt by oil prices in the 90s. So I don’t think it’s necessary for. That’s my point. It’s not necessary for oil prices to go lower, but it’d be great to see that happen.

And as far as rates go again, anytime rates go up and oil prices go up, we’re going to see weakness in the market to some degree. I think we just need to be prepared for that and have confidence that Trump and our military can get the job done. And I still believe very much that is going to be the case. I’ll just go to the list here. Tesla, you may have seen the news today. Tesla finished flat on the day, which is kind of an accomplishment today in a market down this much. Again, Dow Jones down 1.2%. But at one point today Tesla was up 2%.

Hit a high today of 433. Closed at 423 flat on the day. You may have seen the news in Austin. Robo taxis are now live. These are the new robo taxis. They have no steering wheel, they have no pedal. And I think I saw 50. I think I saw 50 are being released on the market now into, into Austin.

As, as Tyler just reminded me on the last earnings call, must said this is the way it’s going to start, right? We’ll start in Austin. It’ll just continue to ramp. It’ll continue to ramp. So I think the market’s going to continue to wake up to this, that fully autonomous vehicles, including unsupervised FSD robo taxis and don’t forget Tesla semis. They’re coming and that’s going to place a continued significant bid under the stock. As the markets then begin to take a look at Robo taxi again, the Gen 3, a robotaxi is supposed to Optimus is on track to be in production by year end to some significant degree. And then next year really ramp by the end of next year start arriving in our homes again, limited rollout and then a big ramp. Remember the Model S and Model X facilities in California are being retrofitted for mass.

A million robotech, a million Optimus robots in production a year. Again, it takes time. But remember this, when Nvidia first started announcing they were going to produce chips, AI chips before those were Even ready. Nvidia stock price started going parabolic before they’re even on the market. Because the smart money knew what was coming. Folks, that’s what’s going to happen with Tesla. We’re a broken record on this, but I’ll tell you, it is my firm belief that you’ll look back in the next one to two years and remember how frustrated, frustrated you might have been. The Tesla stayed around 4, 4 25.

Right. And it is, it is again, it’s our second largest position. Goals are largest. It is frustrating, no doubt about it. Everything else getting hot or all these AI plays getting hot. Tesla’s sitting here in a tight trading range, but I sincerely believe that in the not too distant future as the stock breaks 500 and then a thousand and then 2500, that’s 2028 by the way, that’s our target. And then 10,000. Within a decade we’re all going to look back just like we did a Bitcoin at 2000 when we first recommended it.

Nobody wanted to buy it at 5,000. Most people still didn’t want to buy it. It was a scam. And then 10 and then 20 and then 30 and then 50. I think we’re going to see the same pattern. Remember if you’ve been in bitcoin like we have, remember, look back if your memory is better than mine. My memory is not great by the way. I remember the important things.

[00:14:03]:
Remember back on the early days of Bitcoin. 2017, Bitcoin first broke, broke 2000. Remember back what you thought then, Think now, how much, how much more you wish you had allocated to Bitcoin in 2017, 2018, 2019. That’s the feeling and that’s the investment view that you should have about bitcoin, about Tesla. Now this is our number one stock for the innovation revolution. When it goes, it’s going to explode. We’re looking for another move similar to the bitcoin move from 2020 towards it 2020. After 2020, bitcoin broke out from an exactly look a similar looking chart pattern that it has now.

Consolidation pattern of five years. And when it broke out, it was gone. Bitcoin jumped, excuse me, Tesla jumped 700% in 12 months. I’m not predicting that kind of move in the near term here, but it also wouldn’t surprise me because when this goes, it’s going to go, it’s going to be melt up, it’s going to be the micron of today. So I think if that’s the case and again it’s going to be. Then we look at it at 423 and go, okay, what should I be taking money out of my mortgage? Seriously shall be taking equity out. There’s only $36 trillion in home equity across the United States. Should I be maybe selling a home? You maybe you, maybe you’ve got a couple, three homes that you, that you rent out.

Should I be leveraging a child? Because I think I know, I know I tend to do this. I tend to get stuck in my portfolio. I’m a long term investor. I’m very patient. But there’s always an opportunity to lighten up somewhere, take some gains somewhere. I mean gold, silver, look, think about the gains we have there because Tesla is going to be the next super hot stock. This is a gift, folks. This is a gift.

I’ve owned it since 18. I think I can make a confident statement and maybe it carries some weight. Good news today on Tesla. Very, very good to see that going down the list here. Lost Soldier. I just, I was been out of town three days again and I was on the car about a four hour drive back today. By the way, my Tesla driving drove me all the way there and all the way back full fsd. I didn’t touch, I did not touch a steering wheel once.

It is when I have to drive now I’m a little uncomfortable and that’s weird. Like I’m 63 almost. I’ll be 60. Well, I’ll be almost 64 in July. Mark Bruno, I have same birthday by the way. Wayne Allen root is turning 65 the day before Mark and I do. And Mark’s, Wayne’s having a big birthday party for 65th in Vegas. Mark’s going, I’m going, maybe some of you are going as well to 65th birthday bash from for Wayne.

That’s going to be a blast. Anyway, Bruno called me on the drive home today and gave me an update. I’m not going to cover that now. It’s a little premature, but not much. In about six days there’s going to be an announcement made and I’ve asked Mark to make that announcement on our private VRA members call. So that’s coming next week. And yes, I know what it is. And yes, it’s, it’s, it’s going to, it’s going to fund everything that the company is doing and it’s going to bring a lot of eyeballs to Lost Soldier.

So it’s very good news for everyone that’s involved in Lost Soldier. I’m going to go ahead and say Congratulations. This is going to be one of the largest oil and gas plays, gas and oil, probably in that order in the country. And a lot of people are going to build, in my opinion, generation, multiple, multi generational wealth because of this oil and gas field in Wyoming. So it’s very exciting. I mentioned bitcoin and the decline. Look, if you’ve been in bitcoin, you’re used to volatility. I mean, whoever said bitcoin is a store of value, I think kind of should be left out of the room.

It’s not, it’s not really a store of value. You can see the way it trades. You know, we got news a couple days ago that Michael Taylor, the strategy CEO, had sold a whopping $2.6 million worth of Bitcoin. He owns billions of dollars worth of bitcoin and many, many billions. I. I don’t know the number. And so when he, he kind of teed all up last week, he said, we’re probably going to sell some. Again, that’s just, in my opinion, smart planning.

[00:19:22]:
But he also did say in multiple posts on X, never sell bitcoin. Sell a kidney. Well, now, now he’s catching some chip for that. Probably rightfully so. But again, it’s a small amount. A couple days ago announced that if in fact had sold some bitcoin. And so I, I think that’s part of the impetus for this decline. But I also remember bitcoin’s biggest moves higher and they just came out of nowhere.

Again, I think these chart patterns are very similar. Bitcoin, Tesla, the next move higher will come out of nowhere. That’s how bitcoin tended to trade. Am I worried about it? Absolutely not. Bitcoin bottom at59.7 the night of the war. I don’t want to see that broken. If Bitcoin breaks 59. 7, then yeah, we’re probably, we’re going lower.

It’s not a prediction. I don’t think it’s going to happen. But am I concerned? No, we’ll continue to buy it monthly. Same thing with Tao. That’s, that’s what we’ll continue to do here. Anyway, that’s kind of our bitcoin update here. What else today? Oh, VR investing system. I’m going to cover this briefly with you because I think it’s important.

I, I covered this this morning. VR system remains 10 out of 12 screens. Bullish. That’s back at the truck territory. But we also have to understand that, yeah, we’ve had a big move. It has been melted ville but what is interesting, you would think that all of our major indexes are trading at extreme overbought on steroids. That’s our most overbought level in the very system. But, but they’re not there.

Are we covered? We have four momentum oscillators in the very system for our broad market indexes. Three of the four are extreme overbought, but the fourth is money flows. And for none of the indexes, our money flows at extreme overbought. And I think the reason for that is that there have been a lot of people leaving this market. You’ve probably seen a lot of retail have been selling thinking it’s another bubble top people listen to Michael Burry and all the perma bears out there. And I think that’s part of it. Money flows are leaving the market to a degree, but there’s also been a very high level of short selling taking place. Matter of fact, it’s historically very high level for the SP 500.

So I think that explains the money flows not hitting extreme overbought levels, but just purely on the very system. No, we would not take profits here. Also I think of note, this is one of our kind of go to indicators for a market that’s really overbought or really oversold. The percentage of SPF 100 above the 50 day moving average is only 53%. That was as of this morning gonna be lower after today. The percentage over the 200 day moving average is only 55.8%. To put that in perspective, we would not consider even lightening up or taking profits in the portfolio until we got close to 90%. We’re, we’re, we’re just as oversold as we overbought probably in this market, more oversold.

So we’re just not seeing the classic tells that this is a market that should be taking profits in. Not at all, just not saying it. Also as a fact that Todd and I like to repeat fairly often during the dot com melt up. Again, this is the most similar bull market since then. NASDAQ put up gains of 572%. All right, that’s pretty good for five years, right? To date from the October 13, 2022 bear market lows, NASDAQ is up only 162%. A little bit lower now again, this is as of this morning. So 572 and dot com.

162 so far in the innovation revolution. That’s not a sell signal. We have a long way to go. All right, let’s take a look under the hood Today internals were probably about what you think. Advanced Decline, NYSE negative 3 to 1. Nasdaq much better. 2 to 1 negative down. Volume NYC was 77.

Yeah, 77. That’s fairly 70 or I think that’s right, 77. How do you want to see not over 80. So it’s not a huge concern. Nasdaq only 60% and we actually had more stocks hitting a 52 week high today than you get a 52 week low. So again the internals about what you’d expect to see on a day like this. And again, we’ve come very far, very fast. Sector watch today also better than, than I would have thought it would have been.

Yeah, much better. Six sectors lower, five higher. Technology down 1.5%. Financials down 1.2. That’s the really all the damage there. Energy today up 1.3%. Consumer staples up 8/10 of percent. Again, no, no, no real damage here at all.

[00:24:42]:
Also of note, the put call ratio over the last two days was ridiculously low. This, this decline was almost predictable because we were at levels that you, you just don’t see. You see them like once a decade frankly. And that’s how, that’s the percentage of people buying calls. Everybody’s all bowled up. There’s no chance the market goes lower. So again, kind of predictable today. Complete bounce back.

We closed at 8.8, 0.8 calls to puts. Excuse me, puts calls. So again, people are already starting to get ready for a move lower. And again that’s what you want to see. You don’t want to see the, the, the, the numbers in the fives and sixes which is what we saw the last couple of days. And our commodity watch today again, this has everything to do with the war. It’s the war tells. It’s oil.

And rates gold today down $57 an ounce. 1.2%. 4462 a point I’ll make on this. Look at, I just looked at the charts before this podcast. GDX has a falling wedge pattern that to me looks really nice. I’m sorry, a, a triangle pattern that continues to look like a classic triangle bullish pattern and it’s also at the 200 day moving average and it’s also oversold. We continue to like this group. Same thing with gold.

Gold also very near the 200 day moving average. A classic falling wedge pattern. Again we get good news out of Iran. Our interest rate sensitive portfolio is still set to skyrocket and we are, we are maintaining position just like that. That’s our primary trend. We’re not going to change it because there’s a skirmish happening with Iran. And again, our belief is that that’s going to come to an end today. Silver down 3.4%, 72.96.

Copper down 2.8%, 686.48 a pound. A crude oil today up 2.6%. Last trade, 9620 again, we really don’t want to see 100 plus markets kind of starting to discount that a little bit. And Finally, Bitcoin, last trade, 65,357, we covered that just a bit ago. Down 3.2% in the last 24 hours. All right, folks, that’s it for the day again. Hope you had a great day and you a better night. We’ll see back here again tomorrow after the close.