Welcome to the VRA Investing Podcast! In today's episode, host Kip Herriage dives into a whirlwind Monday in the markets, sharing insights and lessons from historic trading days, including the infamous crash of 1987. He reflects on the wisdom of his mentors—especially Ted Parsons and his adage "never sell on a Monday"—and examines how those lessons hold true even amid today’s high volatility.

Don’t look back because the market is closed. Good Monday afternoon, everyone. Kip Herriage here with the Daily VRA Investing Podcast. Hope you had a good day today. We did have a good day today, didn’t we? I woke up this morning at, um, usual time, which in markets like this is normally 2:33, and, uh, no alarm clock. Why would I need it? I barely go to sleep anyway. With markets that have been this rattled. I know you know what I’m talking about.

And, uh, you know, you wake up to Dow futures down 1,200, you really just want to roll back over and go to bed. But then you realize you’re not going to sleep, not, not, not with that. And then what happens? Well, we only had a 1,500-point rally in the Dow, only had a 900-point rally in the NASDAQ. Here’s some things we’re going to talk about today. First of all, a shout out to my first mentor Ted Parsons. If you’ve been with this long, you probably know, you probably know Ted as well as I did right now, uh, because we would talk about him all the time. He’s been in, I think, every book that I’ve written, along with Michael Metz, my second mentor at Oppenheimer. And, um, you know, as I wrote this morning in the letter, I could literally hear Ted’s voice.

I could hear right now, never sell on a Monday. He would walk, he was a personality. He would walk around the office and just shout, just say these things like these old adages, right? Never settle on the money is one of them. There’s a lot more. Maybe I’ll do a podcast one day just about Ted Parsons’ adages because they’ve all held up. The one thing that probably didn’t hold up was Ted used to love to say $1.10 for a dollar. I’m not sure I ever know exactly what that meant, but you know, things have changed with the dollar, have they not? I think Ted would probably have changed that to gold instead of a dollar. But anyway, Ted Parsons, never sell on a Monday.

That’s something that, you know, I’ve used that throughout my career. And I can’t say that it’s 100% perfect, but what I can say in times like these, when you had a couple weeks with high volatility and you come into a sharply lower Monday open, I can tell you that selling, selling on a Monday would have always been a mistake. I can’t think of a single time that it’s not. I had somebody on Twitter today say, now remember, Kip, you’re trying to, you know, call me, say that I was wrong. Hey, the crash of 1987 was on a Monday. You know, I’m like, you’re exactly right, it was. And I remember that day pretty well. And every broker, every single broker that entered a market order— because limit orders weren’t being accepted— every single broker that entered even a market order— now it took a couple hours for people to find out limit orders weren’t being accepted, right? The, the, the, the, the computers, which were tiny then, were just overwhelmed.

So about 10 or 11 in the morning, we started getting the word back, no more limit orders, market only. And people are like, okay, fine, at least I can get out. So for the rest of the day, we saw all these, you know, we had the old tube system, right? Uh, like you do in a drive-through bank, and you see broker after broker lining up and just, they’re all pink, right? With a sell ticket versus the green was a buy ticket. Every order entered was red, right? Just boom, boom, boom, boom, all day long. And as the day got worse, it only picked up. That day, Ted did not enter a single sell order. He just said, let’s sit here and watch this together. Let’s watch these people make the mistake of their career.

At— with about 30 minutes before the close, Ted started just strolling up to the, uh, to the, uh, tube system. And putting in as many buy orders as would fit in one of those little round containers. He had 3 or 4 of them, just boom, boom, boom. Everyone that entered a sell order— again, market orders— they didn’t get their closing price. They didn’t get what they sold at the end of day Monday. Most didn’t know by the end of the day Tuesday what they had sold at. Most of these confirmations started coming back Wednesday morning throughout the day, and by the time broker brokers got these, they were just devastated. I mean, there were people that were in shock.

[00:04:36]:
What are you talking about? I sold at the lows of the day. They filled everybody at the lows of the day on Black Monday. By the end of day Wednesday, if you just held your positions, you you’d be break-even. By the end of the day Thursday, you’d be up 5 to 10%. I, I watched several brokers that I knew— these are senior brokers that have been in the business 40 years plus— their careers were, were devastated. Their entire books were blown, and they, and they, they quit the business shortly thereafter. So yeah, selling on a Monday held up in 1987., and it continues to hold up on most times in situations like this. Again, thank you, thank you, Ted Parsons, for the lessons you continue to teach me even from the grave.

Rest in peace, my friend. I’m going to talk today also about the Trump pivot. You may have seen this about an hour before the close. This is something we believe was going to happen, and we did. We got a wish, didn’t we? Semis today at 3.6%. Semis lead. That’s great to see. Uh, we’re going to talk about the oil analytics.

I wrote this up this morning, got some new stuff for you here, uh, to illustrate exactly how overbought oil gets. Just when, just when you see so many people in the media saying, yeah, this is realistically, oil could go to $150. I, I see $200 actually. I mean, and they’re rooting for it. You can tell this is, this is a joyous moment for them. They’ve been waiting for this. Um, it’s get Trump. I mean, I’m telling you that this is get Trump.

[00:06:14]:
Uh, there’s a, there’s a hatred for Donald Trump. I’ve talked about this a lot on these podcasts, haven’t I? There’s a hatred for Donald Trump that transcends— I mean, it really is TDS. It transcends, uh, rationality. It makes it not possible, and their decision-making process is just being devastated, destroyed. And the end result is they’re blowing up their books again, right? This is what’s happening because they’re rooting for bad things to happen to this country to the point that they hate Trump that much, right? I, I, I don’t care who the president is, that’s not something that you’re ever going to find me doing. I don’t, I don’t understand the mindset, okay? I don’t understand the mindset. Um, all right, let’s get to it. Uh, again, big, big big recovery day today.

Trump came out about an hour before the close and said basically, you know what, I’ve got it right here, let me— this was his exact quote in an interview with CBS. Why he’s talking to these guys, I got no idea, but you know what, he likes talking to the other side. The war is very complete. Very complete, and the U.S. is very far ahead of schedule as Iran has no navy, no communications, and no air force. And that’s what staged the rally. You know, we looked up, the NASDAQ had already gone green, and that happened much earlier in the day, right? And then, you know, within, within, literally within a minute, everything was green. Uh, we closed right at the highs of the day.

Uh, I, I normally don’t, don’t, don’t give out, you know, what the close is because usually by the time that you hear this you, you already know, uh, Dow Jones finished up 239, NASDAQ up 308. These are all just off the highs of the day. S&P 500 up a big 56. But again, the semis up 3.6%, NASDAQ up 1.4%. That is the semis leading NASDAQ, NASDAQ leading the market. That is textbook. That is textbook bull market action. And again, it’s early.

Let me just say, I’m not, I’m not, I’m not claiming this is over by any stretch. But I am saying that these are very good signs. Ships are flowing through the Strait of Hormuz. Yeah, these are all the signs that we are looking for. And we said last week, excuse me, this is no longer about Iran. The markets aren’t concerned about Iran. They stopped being concerned about Iran last week. That’s just the reality.

Iran posed very little direct risk to the US. Now, Could there be, you know, IEDs going off in the US? Sure. I mean, that wouldn’t— I don’t think that would surprise anybody. They tried to do it in New York. I’m not sure who the culprit was behind that. But would it surprise me to see these Iranian gangs try to do these things? No, we should keep our head on a swivel. Wouldn’t surprise me at all. And if those happen, well, look, if they do it, you know, look, we know the worst case, right? The worst case is horrible.

We don’t want to see anything like that. But other than that, Iran poses very little direct risk to the U.S. So this is all about the Strait of Hormuz and oil prices. And as I said last week, if I’m Trump— and look, we know he loves the markets, we know he loves taking credit for their gains— my guess is in a month or less, when we’re back at all-time highs, Again, we’re, we’re now in that ultra bullish period of March and April, right? We’re now in the last 3 weeks of Q1. That means Q1 earnings coming out, right? These are going to be extraordinarily good. So that’s what we think is going to happen, by the way. We’ll be back at all-time highs in no time. But because Trump knows this is all about— this is all about oil and the Strait, right? And so now we’re seeing that handled.

[00:10:11]:
Um, you may have seen oil today, right? Again, I should have talked about at the beginning this morning. I wake up and the first trade I see in oil is $119. $119. And I’m like, hmm, let’s see, it was Friday, it was $92, and that’s when I said a, a high in oil is nearing. So I was like, I blew that call. Turns out I didn’t. Uh, last trade in oil is now— last trade in oil as I speak is, uh, $84. $84 with a low at $81.

As Tyler just said, that’s a pretty good round trip. $120 essentially. It’s not $119 and change. $120 to $84. And I think Tyler’s right. I think you got to go back to the days of the pandemic, uh, to see a move like that. Remember, oil went into negative territory then, right? We’re seeing just the opposite. We’re seeing backwardation of, of, of a scale that we’ve never seen before.

All right, I’ll cover that more in just a moment as well. But that’s it. It was oil and the Strait of Hormuz. Again, knock on wood, that looks to have been sorted. And so with this in mind, you know, as you know, if you know us, last week we began adding to positions. We’ve been adding to positions throughout the week, and that’s because the macro story of the U.S. economy and corporate earnings hasn’t changed. It’s not going to change.

This is a structural bull market. I don’t think enough people understand what that means. This is the beginning of GDP growth that’s going to go past 5%, past 8% within the next 2 years. That’s why we’ve said this is a generational bull market. Events like this are, are, are, are scary, right? They’re nerve-wracking. Uh, it makes us question, am I making a mistake by being long? But in actuality, right, this is when the inpatient money is transferred to the patient money. This is throughout history we’ve seen this. You know, again, Warren Buffett, right? When others are fearful, we should be greedy.

Well, this is another kind of a textbook situation of that staring us right in the face right now. Um, yeah, so it’s all about oil, and for us it’s about— it’s about discipline and positioning, because if we’re right about this market, this is going to be a stellar year. And it’s this kind of negativity that’s now baked in the cake that’s caused so many people to question their position, so many people to sell, make a mistake. This is where massive rallies come from. This is how they’re born. So again, I’m not, I’m not claiming victory. Don’t misunderstand me. I think that we could have another negative surprise or two.

But yeah, I think the lows are in. We’ve said that since last week. Effectively, that’s been the case. And we remain buyers. We remain buyers. We’re actually looking to add a position, which came very close to adding a position housing today. Uh, that would have been the smart money move, frankly. Should have done that at the open.

[00:13:47]:
But there’s nothing wrong with just taking a little— we’re going to get, we’re going to get a couple swings, right? We’re going to get another opportunity. Uh, can I tell you why that is? This is my conspiracy theory, but it’s held up on any number of situations. The really big money, the shadow money, has not had a chance to go in and go aggressively long. They usually find a way to get a story planted. Look at Zero Hedge. They’re the ones they use predominantly. Again, Zero Hedge, if you listen to them, you’ve been wiped out. You’ve been— your portfolio has been destroyed.

Now, if you know how to read them, they become a powerful tool in your tool belt. But if you actually pay attention and act on what they say, you’ll be destroyed at tops and bottoms. But my guess is, and this will probably happen later this week, there’ll be another story that comes out. It’ll seem credible. Futures will open lower. That’s when we’re going to be adding again. That’s what we’re going to be looking for. I’m just telling you, I’ve seen it happen any number of times, and that is what I expect to happen.

So again, we got the Trump pivot. That’s what we’re looking for, uh, because— and again, I wrote this up this morning, uh, this is going to offend some people, but I do not care. You know me, I, I don’t, I don’t, I don’t, I don’t do this to offend, but I do it to be honest, right? I actually talked about with my wife Cindy about this over the weekend because It is important to me how I phrase things and say things. I don’t want to just, you know, be a shock jockey and just put that stuff out there. That is not how I operate. I hope you know that. But this is when we wrote this morning that Trump needed to pivot. This was the time.

Because if you’re watching the news, you’re seeing the skies over Iran full of oil. You’ve seen bombing that’s been nonstop. I mean, just just devastation of many parts of Iran. And as we know, their leadership, multiple levels down, has been fully taken out. So as I wrote this morning, at some point, and I think that point must be soon, the American people will begin to turn on this war, wondering how can this be about the Iranian people if we’re bombing their country into unlivable conditions? When I saw the oil in the air, right? There was also apparently a desalinization plant hit. That’s— I’m still not seeing anything hard on that that points to the US or Israel, right? So I don’t want to make a claim that’s not true, but the oil in the air, the devastation we’ve seen, unquestionably the innocents that have— it’s hard to take over a country or bomb them into submission and say we’re doing it for you. We’re doing it for your freedom, when all these people’s family members, friends, cousins, relatives, co-workers are being blown to smithereens. You know, it didn’t work too well in Iraq.

And so I think again it was time for Trump to pivot. I, I think we saw the pivot today. Matter of fact, it looks like we did with this statement of, of success this afternoon. And also This is more of a, I don’t know, this is more of a debatable point than it should be, I think. And you should be able to talk about this. To some people, you can’t talk about this or you are a bigot. You hate Israel, right? I clearly don’t. I think they’re an important ally.

[00:17:34]:
I’ve got questions about the control they have over America as a country and certainly our leadership. But we’re getting these questions from you. The longer this goes on, the more it looks like we’re being controlled by Israel. As I wrote this morning, I think that’s becoming a very fair question. So it was time for the pivot. Trump is nearing, I think is nearing a point of no return with the country. No one voted for Trump for this. I think he’s going to wind up winning.

I think this will be part of his legacy. I think, because again, as I said last week, I have confidence and trust, confidence in Trump when it comes to the military. And I think he’s earned that. But it is now time. To update the country on what the remaining mission objective is, because blowing them to smithereens with all the leaders gone— so what is the objective now? Again, I think we saw that turn today. I’m hoping that’s the case. I think that’d be a very good thing. Just after Trump was elected, a lot of you may— hopefully you remember this— I put something out on Twitter and in our daily letters, talked about it for a couple weeks.

I called the Trump Doctrine that Trump was going to take control of America in a good way, talking about free market capitalism, pure free market capitalism. He was also going to make sure our hemisphere was safe, right? Drugs all up and down the hemisphere, right? Venezuela, Mexico, obviously the border, the this is all happening, America is healthy financially and doing very well economically. But that would put pressure on other countries to do the same. And if they didn’t, they would only fall farther behind us. So I’m sure you’ve read this everywhere. I mean, from big-time Trump supporters that say what he’s doing here will be in the history books for forever. If Trump’s able to pull this off with Iran, it looks like that’s happening, while doing the same again throughout our entire hemisphere. Cuba’s going to be next.

No, I don’t believe it’s going to be a military operation at all. I think they’re ready. I think the history books are going to look at Trump as a one-of-a-kind. Certainly, certainly, you know, in our lifetimes. And so that’s what we’re rooting for, okay? That’s certainly what I’m rooting for. But again, I don’t understand. I’m seeing this all over on X, right? You know, to my post about, you know, Custer’s last stand for Israel, which we talked about last week, about the success of this campaign so far against Iran. And, and, and now today, again, don’t never sell on a Monday.

[00:20:40]:
I put that over this morning, got a lot of pushback on that. Again, with the people saying oil’s going to $150— no, it’s not. Uh, the highs— we got a shooting star signal today, okay? A shooting star in oil is a very reliable sell signal, very reliable. Sell signal. We got that today with the open at 120, and now the collapse to last trade 84. From this level of overbought, okay, it’s very rare do you see oil this overbought, the backwardation. And that’s what we’re talking about here. We talked about this last week.

Going back to 1985, we’ve had this level of extreme backwardation That’s when near-term futures are much, much higher than long-term futures for oil. The data tells us, and it’s, it’s, it’s, it’s unrelenting, and it’s 100% of the time, folks. The average loss in oil over the next week has been 4.2%. Over 2 weeks, 9.7%. Over 1 month, 14.3%. 1 year later, the loss in oil has been 27.8%. Again, high probability shooting star on steroids, a sell signal for oil. We also told you late last week that— excuse me— that oil stocks— excuse me— oil had hit extreme overbought on steroids.

That’s why the open this morning at 119 was like, okay, now it’s really extreme about steroids. But certainly it’s there. That’s when bad things happen. And we also share with you in this morning’s letter Again, another very— I love these relative strength charts. We use them all the time, don’t we? You know, miners lead gold, oil leads energy stocks, and oil service stocks lead energy stocks, right? Again, very reliable. We started seeing a breakdown last week in oil service stocks compared to XLE, the energy ETF. Again, it’s just another sell signal. The point being We didn’t have one, we didn’t have two, we didn’t have three, we had four high probability repeating pattern sell signals in oil.

Now, we, we, we, we prefer to— in a bull market, if you’re asking, well, did you short oil? No. Uh, we looked into various options. It’s just not really— we don’t like to short anything in a bull market. That’s, that’s, that’s the bottom line. We’re primary trend traders. So instead, we’re looking for the buying opportunity because we want to buy things that we’re going to hold for, like, usually a long time, at least 2-3 months in our VRA ETF trading program, right? So we’re looking counterpunchers, right? We’re looking to buy. And, and that is what we’ve been doing the last week and will continue to as this week unfolds. All right, what else here? All right, let’s take a look under the hood today.

Uh, internals were, you know, about what you think on a day with this kind of a bad open and a good rally. Some are great, some not so great. Advanced decline was slightly negative for NYSE, uh, more than slightly positive for NASDAQ. NASDAQ was actually really good today. Volume today was higher for both. Up volume of 57.8% NYC, 71.4% for NASDAQ. And, um, we did have, um, about 300 more stocks hit 52-week low than high. But remember, these are cumulative, right? Cumulative indicator.

[00:24:24]:
So, you know, if you hit a new 52-week low at the open, it remains— that read remains at the close. But I would expect tomorrow’s to be much, much better. Sector watch This is more like it. Uh, this is very good. 9 of 11 sectors finished high on the day. Remember last week, even as the markets are selling off, we didn’t see it in the internals, right? What did we also see last week? Our FIFO stocks, first in first out. Bitcoin led higher, software stocks led higher. Okay, those are all holding up.

Uh, Bitcoin was a little soft today, but it rallied to the close here, or into the last hour of trading. But technology up 1.8%, what you want to see. Communication services, essentially tech, also up 1.2%. Again, 9 of 11 sectors higher. Financials down 0.5%. That was energy down 0.4%. That was our other tell from last week, wasn’t it? As we talked about it, energy stocks were going down as oil was spiking to $92. So that’s a sell signal.

It’s not a strong sell signal, because it was only over 2 days, but it was our first tell something’s changing here. All right, something’s changing. Uh, commodity watch today. Again, gold was down over, well over $100 at one point, now down $48, uh, $5,092. Uh, the chart’s looking fantastic. This is a buy on this pullback. Uh, you still got— again, there are still people saying that we’re going to have— it’s likely we’re going to have a recession in this country. And you have just enough, enough dummies and AI programs to listen to this that they, they sell or short oil— uh, gold.

That, that will be, that will be a big mistake. Uh, silver, uh, silver rally today, uh, at one point was up— is that right? Give me a second here. I think my system is, uh, not refreshing. Yeah, uh, sorry, sorry, gold was only down $10. My bad. Had a bad read there. Uh, $51.48, big comeback in gold. Silver today up $3 an ounce, 3.5% move higher, $87.31.

The low this morning was $79.68. Again, that’s a tell. That’s a tell both for commodities, for the miners, and it’s a tell for liquidity, folks. That’s probably the most important tell. That’s probably the most important tell. Very good to see. Copper today also staged a big comeback. Low, $5.64 a pound.

Closing at 59— sorry, $5.90 a pound. I gotta get glasses, I guess. Crude oil, again, high today of $119.43, last trade $84.67, down 7% on the day. Um, yeah, oil’s not going to $120, $150. If it does, uh, then we got, we got other problems. We have something else going on beside what’s happening and taking place in Iran. Let’s all, let’s all hope against that. I also want to talk about one more thing today.

[00:27:25]:
Uh, Bitcoin, uh, last trade here, sorry, uh, $69,100, uh, that is up on the day as well. Again, first in, first out, done very well. Finally, I want to share this with you. I saw this over the weekend on X. I wasn’t doing X, I saw it on Twitter. It I always feel weird to say that. I saw it on the social media platform X, just to make that clear. And it got my attention because it made me think about this war against Iran in a different way.

Here’s what cynical publicist said. Do average Americans understand just how much GWOT, Global War on Terror veterans, hate Iran? Do average Americans understand that basically every GWAT veteran knows comrades in arms who were killed or maimed by Iran? Do average Americans understand that while GWAT veterans hate the idea of useless wars, endless wars, that must also support a rapid takedown of the Iranian machine that murdered their friends, so long as the fight is led by decisive makers who allow us to win? Do average Americans understand any of this? It brought it home for me because frankly, I’ve been wrapped up in the circus that is all of this. We’ve had 7 lives lost and God bless them all. Thank you for your service and rest in peace. But I had not thought about this from the point of view of all the veterans from the war in Iraq and Afghanistan and all the fallout that’s followed since. The thousands upon thousands. I know that during the early days, I’d say the first 6, 7 years, if you will, remember the war went on forever, 20 years, between Iraq and Afghanistan, we had 7,000 soldiers that passed, that were killed, and over 100,000 that were injured. And those numbers only grew with IEDs and roadside bombs, etc.

And then the lives that were destroyed and the families’ lives destroyed because of the PTSD. Men and women still living with that today. I can’t imagine. I can’t even begin to imagine what they’ve gone through. But if I may for a second speak on behalf of veterans, even though I have no idea what they’ve been through, or what their lives are about day to day. Let me say thank you for your service. I can’t even begin to understand your hatred toward Iran. I think at the end of the day, I think Trump sees that, knows that, feels that.

He’s very tight with the military, and he’s proven it time and again. I think one of the victories that comes out of this if it continues the way it looks to be going now. And, and I have to say, uh, it looks like the war’s over. It just does. And it’s a good thing. Is that all our veterans injured, maimed, those that were taken from us— this is a win for them. And I think, look, we all want to see wins out of this— lower oil prices, peace for the Iranian people, less conflict throughout the region, all of that. But I think for these veterans that paid, in many cases, the ultimate price, you know what, I really do hope that this has been for you, because that is the right thing to do.

[00:31:14]:
All right, folks, that’s it for the day. Hope you had a great day and even better night. We’ll see you back here tomorrow after the close.