David Lin (Uncut) 12-21-2024

Stocks had a massive pullback this week following the FOMC’s decision to cut rates by 25 basis points. The Dow Jones extended a 10 day losing streak, the longest since the 70s. So we’ll talk about whether or not this correction is the start of a longer or bigger decline downwards. Actually today just we’re talking on the 20th of December.

The stocks are rebounding a little bit. But what is actually going on? Christopher Moulin is breaking down stocks bitcoin energy outlook for his best play for 2025. And he’ll be sharing all this with us right before the new year.

Welcome back, Chris.

Hey, thanks David. Always a pleasure.

Chris of course is the chief market strategist of the technical traders dot com. You can revisit our last interview with Chris link down below. In our last interview, Chris, from a couple of weeks ago, you made the call that bitcoin would top near term at about 108,000. Perfect call.

Let’s start with that because bitcoin did top at around 108,000 before sliding back down to below $100,000 now. So we’re at 97,000 as we speak today. My move by the time we publish this in a couple hours. But let’s pull up a chart of bitcoin.

Sure. Let’s take a look at. Yes, because that was a great call. Walk us through again your rationale for calling for 108,000.

What did the trend line say and what is it telling you now?

Sure. So the way we came about the upside target for bitcoin was really, we really are just looking at the chart.

Just for some context for the audience. You made that call a couple weeks ago when bitcoin just was just under $100,000. Actually it didn’t even pierce 100,000 yet.

Right? Yeah.

So we were just on the up climb.

Yeah, exactly. So several weeks ago, quite a while ago, we just looked at this chart pattern and the chart pattern here, which is, this is the most conservative chart pattern. We had a beautiful run up price flag sideways, which is known as a bull flag pattern. That first section there is the halfway point.

A bull flag is the halfway point, knowing the second half should move up. And I use Fibonacci extension and really we just take the low, we go up to the high of that rally. That tells us the upward momentum. And then we go all the way down to how much momentum it had pulling back.

And this pretty much gives us some of these, these targets. Depending where we go here, this is a few different levels. And so this is what’s telling us where we need to be aware of this chart? So we had a first target at the 618 level.

We also had another target at the, the 108 level, which was right up in here. And we hit both of those. And that’s simply based on a Fibonacci extension. Typically when you run up to the 618, usually it has a pause, and if it pauses, we.

We push even higher. We saw that actually back over here, we had a move up, it took a pause and then had the second half of the move. But this is a very simple type of analysis. Bitcoin was kind of one of those trades.

I haven’t traded bitcoin in forever for about a decade. And I bought it a long, long time ago. But it was based on this weekly chart. And so this weekly chart was telling us that, hey, this is a huge cup and handle pattern, a big bull flag pattern, and we should expect that big pop and rally to the upside.

And of course, the monthly chart gives us very clear, definitive levels of, of where these are. And these were the, the key levels here. The 87,000 was where our first target was. 109, 108,000 where the second target was.

We hit that and we pulled back. And so it’s always good to step back and look at the bigger charts, the bigger pictures of these trends to get those targets. And bitcoin is a very crowded trade. Everybody watches it.

Everybody moves. It’s a big school of fish. And that’s why I like it, is because once it starts to move, the school of fish moves very quickly. Of course, we got in just as it was starting to break out, and it was a 40 move.

We hit 40% this week. We got out and stepped aside. And so now we’re just waiting to see what bitcoin’s going to do. Build another chart pattern.

I mean, no rush to trade a lot of bitcoin. I just. If we get another perfect chart set up, I think there’s more upside. I think bitcoin could actually go to about 160,000 as long as the stock market doesn’t top out.

If stock market tops, I think bitcoin is going to get pulled down with it.

Did you say 160? 160.

1 60.

Yeah.

Big move, Big move up. Yeah.

Okay, we, we’ll talk about that. But actually before that, I’ve heard that because it’s already breached $100,000, it’s reached 108. That $100,000 now is the new support do you buy that?

Not really. I mean, yeah, it, it’ll work a little bit as when if I just flip to the daily chart, it is a whole number. So it is trying to, it’s hanging around this level. Obviously we’ve been seeing it flip and flop right around this, this hundred level.

So it’s trying to act as a support level there. We’ll see. We’ll see if it can get some traction. I think we could see bitcoin just based on this, this price action of the.

The last rally. I think we could see actually bitcoin pull back quite a bit actually from this point. Let me just draw. I think we could see bitcoin pull back to about 87,000, maybe 80,000 down to this little sweet spot first.

I think there could be a bit more of a. But you’re right, it is. It’s holding at that a hundred thousand, give or take a couple grand as when we were stuck under it. It’s resistance.

We’re somewhat stuck at it now and just trying to figure out is this, you know, going to be support or is it going to be resistance and we’ll just have to wait and see. But 100% measured move was hit on this chart. Typically after we hit 100% measured move, we see a pretty big pause or pullback that could last several weeks. So I think, I think it’s.

I’m not excited about bitcoin at this point. I’d love to see a pullback and chop around. The longer it trades sideways here for a few weeks, the better. It could provide another opportunity to get long on the next breakout and could be another big, big move.

But right now it’s just kind of a shot in the dark. Technically it’s kind of put in a short term top and I don’t really want to hold it.

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That’s under $5 a month. Great deal, great resource. Check out Ground news. Okay, so what you’re saying is there’s a short term correction coming before we hit 160.

You’re not calling for that to be the next move from this continuous momentum. Okay, so tell us about the timeline for bitcoin. What can we expect going into January and that eventually 160?

Well, as long as the stock market doesn’t top. I believe if the stock market does top come January, February, I think bitcoin’s going to get hit very hard and move back. But just looking at this chart pattern, I think there’s, I think it could potentially happen. It will be a very explosive move.

That’s kind of how this asset class moves. I think it could be like two, three months from now. We could see that actually pop and scream higher that that. I mean that is an extreme upside potential move.

It’ll be the crowded play, everybody piles in and be way up here and it’ll be, you know, a parabolic type move. I believe if it was to hit this level, it’s going to reverse and come straight back down. I think it’s kind of that we might be getting into that perfect storm scenario where everybody wants to pile into it. It’s the one asset class that’s performing really well.

Gold’s kind of stalled out. The stock market has got people nervous. Although you know, the NASDAQ was at all time highs like 3, 4 days ago. A one day pullback on news has everybody thinking like it’s the end of the world.

But it’s not. It’s. We’re still in a technical uptrend for stocks, but I would say bitcoin. If we’re going to hit this 160 before I think the economy turns, it’s got to be in the next like 2, 3, 4 months.

Right. So this, the timeline for 160 is 2, 3, 4 months of what you’re saying. Okay, walk us through the logic of 160,000. The, the, the number.

How did you come up with that?

More or less. You take the Fibonacci move And you can. This is a giant cup and handle pattern. So when we look at this chart pattern, a cup and handle pattern is it forms a cup and then you have this little teacup handle.

And when you have a major pattern like this, you can stack the height of that cup to the upside. So you take the height of that move. This is obviously very rough analysis, but you can stack it up here and eventually it stacks up that you can have a cup and handle can be 2, 3, 400% the depth of the cup. And so more or less, if we were to take extreme highs and lows and stack it up and use Fibonacci, it ends up drawing giving us a level of about $160,000.

That’s kind of like a blow off phase, maximum potential move on the next leg up. So that’s kind of what we’re looking for in terms of, you know, if we’re looking for this type of momentum. I’m talking about like this little pause right here after this strong move is very similar to over here. You hit a target, it has a pause and then it explodes for the second half of that move, which would send this skyrocketing higher again.

And then of course if that happens, it’s probably going to come back down to this level which happens to be that a hundred thousand mark that you mentioned that could act as that support level. So right now it’s building volume through here. It’s building a level where investors are changing hands in it. And so you know, that’s kind of the analysis is just this cup and handle pattern, this monthly chart and this type of asset, how it can have these explosive moves where everyone can pile in and drive it higher.

It’s like a, it’s a global mass market move and it’s a, you don’t know how far it’s going to go. That’s what makes it dangerous. It can go, it can rally straight up, it can drop straight back down. It’s just because it’s the school of fish.

They get super FOMO one day or one week and then complete fear the next and they all move out. So it is obviously aggressive type of trade, but that’s the mentality behind is right now we’re just moving with the school of fish. The trend is up and everything is stacking up to say hey, this could go like parabolic and have this insane spike still.

So you said that this rests on the assumption that the stock market will do well in the next three, four months. I’m assuming that means you think that these two asset classes will remain correlated with each other into 2025, correct?

Yeah, I think bitcoin could do a little bit of what gold does. So I think the stock market, I think we could see the stocks continue to push higher into the end of the year, into January. They might start. Stocks might start to fumble and we might actually see money move into bitcoin.

If bitcoin’s holding up or moving higher, money’s going to come out of stocks. It’s going to go to whatever assets leading the way. And if we might see bitcoin continue to rocket higher, well, and gold, I think move higher while the stock market starts to struggle. I think January is going to be a very difficult reversal month for the stock market.

But bitcoin is a little bit like a defensive play sometimes. I think money could go there and keep pushing it higher while the stock market struggles. Meaning I don’t think the stock market is going up for three or four months. I think it’s going to stall out in the next 45 days or so.

But bitcoin and gold, I think will act as a bit of a defensive play and potentially move higher.

Well, let’s talk about the stock market now. Great segue. Let’s pull up SPX charts. Now.

You made the call on my show that was early December that the S and p has maybe what, 2%, 3% more of room to climb before we see a nasty downturn in January, which is what you’re talking about. I’m wondering if that’s already happened because if you take a look at the chart since we spoke in early December, the S and P has already gone up more than 2, 3%. So that call was good. The Nasdaq’s gone up even a bit more, I think 5, 6% on the Nasdaq since early December.

And then we had this nasty, nasty drawdown, one day drawdown this Wednesday after the FOMC announcement. So I’m wondering if what you’re calling for January has already happened. The timeline just pushed up or maybe not.

I mean, we have seen that move up already. We’ve already seen those indexes pushed. I think the markets have shaken things up and this is what they do the best. So we see some of the strongest one and two day pullbacks in the market during a bull market.

We are still in a bull market. I wouldn’t say it’s a very strong one. Meaning the market internals are weak. The market’s going higher, but it’s not like a raging bull market.

But what we, what we see is this very sharp pullback. It’s the market trying to buck you off. It’s the bull trying to get rid of you before it wants to go higher. And this was, a lot of people were nervous and everybody jumped ship.

They all got out of their momentum stocks. Magnificent Seven stocks got hammered. It’s where everybody is. They’re all momentum trading.

And as soon as it starts to sell off, they all bailed. So it created this huge drop. Not only that, but today as you and I are Speaking, which is December 20, we actually pierced this, this pivot low right through here, which is, or we didn’t quite pierce it here on this, on this chart, but we pierced, sorry, this low over here from the high volume day. And that flushed, I think the stops out.

A lot of people said if it breaks, you know, this big drop, we want to get out. And so we saw that. We saw the market dip down, shake things out, and now it’s starting to reverse. And we saw this with the Vix.

Vix was up 74% in one day. The saying is when the VIX is high, it’s time to buy. Meaning when fear is high and everybody’s just jumped out of stocks, sold everything, then that’s when you know, if there’s no more selling left because they all just bailed, you want to get in, it should be a bottom. And that’s what we’re seeing here is this flush out low and this move higher.

The SPY also shows, you know, the SPY ETF shows it even better. This is the chart I was meaning to show. Right here is this significant pivot low that we saw a month ago was what we saw gap down this morning. If ran all of the stops.

This is the nice thing about spy. This is gauging regular trading hours, 9:30 to 4. This is when the majority of stops are triggered. Not so much the futures one.

This is the important washout. So everyone got stopped out this morning and now the market’s putting this massive reversal, an exhaustion gap down, strong rally. It’s going to be an engulfing bullish candle pointing to a big rally. And that’s what we’ve been talking about.

We have a cycle low. We got the market starting to move up and I think we’re going to see a big rally. And the market literally just bucked everybody off on one piece of news. So that’s kind of where I think we’re going.

I think stocks are going to rally back up to the highs, potentially push the new all Time highs by the end of the year.

Well, that’s 10 days from now. So you’re within the next 10 days, you’re expecting stocks, the SPY, to go back up to 610, SPX to go back up to 6,000. Yeah, right. Okay.

Well, actually, we’re almost at 6,000. It’ll be like more like 6,100 would be the peak. So when you see a big downward move in a single intraday trading session, like what we saw on Wednesday, what’s your initial thought process? Do you panic like everybody else and just offload your entire position or do you short like everybody else?

Do you just do nothing? Do you start buying like, you know, what’s your thought process here?

Yeah, so there’s the, there’s a few ways to do this. So for example, if we were to look at, so this is my trading strategy. This tells us, you know, the qqq, for example, tells us when money’s flowing into equities, we want to own equities. We trim off partial profits.

We took off about 10% a few days ago just before the market crashed. The trend is still up in the stock market. And, and we’ve got money flowing out of bonds. Money is still into the stock market.

If we look at the spy, SPY is still on a buyer signal, meaning the bars are green, telling us this is still, the trend is still up. So people were panicking yesterday or two days ago when this, this, this crash happened. And I don’t see it as a bearish sign. So we’ve got, we’ve got tools and indicators I don’t have loaded on here, but we can see when there’s panic selling above the masses.

And we saw on that big down day a panic selling ratio on the New York Stock Exchange of, of eight people hitting the bid, meaning people just hitting the sell button. They don’t care what price they get. They just eight shares hitting the bid to every one person buying on the ask. And if that’s over three, that’s telling us the majority of people are dumping shares.

So 8 is a standout low, meaning we should see within two or three days a major standout low in the stock market. And when I say standout low, it should be a standout low like one of these. And so that is, that is the setup that we’ve been talking about and watching for. And I believe the stock market is going to push higher.

There’s no need to panic. Like when we look at the S P 500 futures, you know, we were hitting all time Highs, same with the Nasdaq, just like two days before it. So a one day pullback does not change a trend, especially when it’s on news. Right.

And people just get way sucked into the news. They, they see their favorite momentum stocks crashing like Tesla, down like 9% that day. Panic is the worst thing you can do when it comes to investing.

What happens if it triggers like certain, like if it breaks below certain support lines on a one day move? Do you think to yourself, oh gee, it’s time for bearish momentum then?

I mean we have, we have triggers in place. So for example, like we, we took 10% off or we had 10% target on NASDAQ, it actually came down during that day and triggered our protective stop to close the rest of our position out. We’re out of the Nasdaq, but we’re still long the S P500. So we have thresholds because you never know how far the market’s going to fall.

For all we know, it could have had four more down days like this. And so we have position management in place, which most people don’t do, which is if the market moves far enough in one direction, it’s going to trigger a protective stop, saying hey, let’s lock in gains here before things get ugly. If the market turns around, it might generate a new buy signal and we just get back in. But if it keeps free falling, we’re going to be an idiot to keep holding onto it.

So not only did price reverse for that day, but it hit one of our, just our risk tolerance levels saying hey, this is a pretty severe move based on the Nasdaq. We got to lock in gains closing the rest of that position. So that’s what Trig kicks us, will can kick us out of a trade. If you’re managing risk, you’re going to get kicked out of trade.

You’re going to have to reenter at times. But the nice thing is if the markets keeps collapsing, you’re not holding onto a position and watching, you know, months worth of gains evaporate. And you can always get back into a market. It’s like click of a button, you’re back in.

So people for some reason think if they sell, they’ve missed out or they’re done. But you can always buy back even at a higher price. It doesn’t matter, right? It’s, you can get back in.

So the blue line, the, the lower bound blue line that we see here, what is that?

Yeah, that, that’s just the 50 day moving average. You can see we’re just kind of bouncing and staying up that 50 day moving average.

Something breaks below a 50 day moving average, what is the play? Does it, is it a case by case basis thing?

Well, I like price to stay above the 50 day generally I want, I want price to stay above it for the, for the trend to continue, but it can close below it. Like I use a lot of different analysis in terms of. So we would need price to close below the 50 day. We would also need, you know, money flows in different asset classes.

We need to start seeing utilities and gold outperforming and we need to start seeing the trend reverse on a short term basis. So there’s other things we have to take cycles, money flow, momentum, all of that into account. It can close below the 50 day, it really means nothing. But if other stuff are saying, hey, not only has it closed below it, but the underlying lift the hood to the market, you realize, holy cow, there’s money’s flowing out of the stock market like crazy and everybody’s moving to defensive pockets or cash even like the US Dollar.

That is a bearish sign. But right now we’re not really fully seeing that just yet.

I’d like to show something interesting for you in the audience. Can you pull up a Dow Jones chart? DJI and I just want to highlight the fact that the Dow Jones has been on a really long losing streak the last week. We finally broken this losing streak today and yesterday as stocks rebounded.

But if you start taking a look at what happened mid December or early December, it’s been a 10 day losing streak. Now that has not happened since 1978, which is extraordinary when you think about it this long of a losing streak. Now on a magnitude scale, obviously you know, we’ve had 20, 20, 2008, you know those things, those events have drawn down the markets a lot more. But if you just take a look at this magnitude of length from time, what’s your initial reaction here?

Yeah, well, I mean the Dow Jones, I mean it’s a small pocket of stocks, right? So if that pocket of stocks aren’t performing very well, it’s going to pull on this index. Just like the NASDAQ is super heavy with Magnificent seven. If those seven stocks or even one of those stocks does well, it drags that index up.

So this actually bleeds in perfectly to I think what is causing a huge chunk of this. Which if we go and look at the, the energy space of, of the markets here, we’ve had a 14 pullback in XLE, the energy sector and these These are some heavyweights in the Dow and so that, that has been on like a 10, 15 day losing streak as well. So this I think is pulling the, the Dow down. Along with utility stocks.

They’ve been kind of out of favor because people have been moving out of utilities and wanting to get into growth stocks. All the ARC ETFs are up Bitcoin. Everybody’s aggressive right now. So money’s coming out of, of the energy space, which are big dividend players.

They’re a big part of the, the Dow. And so I think that’s kind of bleeding into this extended move down. Again, if we just pull up XLE on this particular chart, you can see the extended move in the energy space. And, and I think this is just the beginning for the energy space.

I think the energy space is about to have a huge implosion. Energy stocks are going to get hit very hard and this is going to pull the Dow down. That’s going to kill dividend stocks like dividend ETFs. It already is.

This bleeds over this, this, this kind of one sector is killing the Dow. It’s going to kill all the dividend paying ETFs. It’s going to hurt RET the most. They don’t see it coming, I don’t think.

Yeah, okay, since you’re talking about that. So energy stocks are down, we’re going down and then that’s going to lead into or bleed into the dividend stocks that a lot of retirees are holding. Okay, good point. Walk us through his thesis here, your bearish thesis on energy stocks.

Yeah, so right now we’ve got this big divergence. We’ve got oil has been going down for the last couple of years. It’s bouncing on support above a critical support level. All I think is we need Trump to get in, start drilling holes everywhere in North America.

We need one piece of bad economic data. I think we’re going to see oil fall out of bed, break down below this level and start a landslide towards about $45 a barrel. With the crazy part is investors are all heavily weighted, expecting World War 3 and they’re expecting huge oil pricing and they’ve just been loading up on energy stocks expecting this to go higher. And I think this is where there’s this huge divergence.

If oil breaks down and the economy goes weaker, there’s a whole bunch of like pivot lows on this chart where we’re going to see the energy sector stocks just collapse. I think we’re going to see like a 40 50% haircut very easily in this sector, unwinding. And these are these purple lines across this chart, these are all dividends. This energy stocks pay huge dividends.

But what I saw this happen back in 2008. You see, energy stocks get absolutely clobbered. And not only that, but they start when oil goes down. They start stop making the big profits and then they start cutting their dividends.

And as they cut dividends, some of them stop giving dividends, period. They get pulled out of funds and there’s more liquidation. So this could be like a big tipping point for the whole energy space to be out of favor for a year or two in a very big way. And you know, because these are dividend paying stocks, retirees are going to feel this the most because everybody buys the same stuff.

The majority of the stock market money is like people, investors 50 years plus, which means they have a ton of money, they’re close to retired or they are retired and they’re all in the same thing. Utility blue chips, high dividend funds. And when they all panic, which is generally all at the same time, they sell off the same stocks and they crash. And I have this, this example here that shows this.

This is the SP 500 at the top. And then this is the SPY dividend, high dividend fund. And as you can see, just like the Dow and just like the energy space, you know, retirees holding the high dividend stocks are down almost nine times more than if they just held the S P500. They don’t realize the risk they have in this sector.

And so huge damage is being done. And another perfect example is during COVID The top chart is the S P500. Covid crashed 36%. Retirees just sitting there holding blue chips saying, hey, I got dividend stocks.

I’ll take my 4% yield and be happy with it. It’ll help counter the losses. Well, they lost almost 50% of their money being in what they think is like the safest, you know, easy, no brainer investment. So you know, this, this is like a ticking time bomb for retirees.

They all hold the same stuff. It’s way more volatile than the stock market. They have all these misconceptions about what kind of risks their portfolios have. And I think things are going to get really ugly for retirees if they don’t do something because the energy space is about to get hammered, dividends are about to get crashed, dividend stocks in general.

And all the retirees are going to bail out at roughly the same time and send things Down. So this is like, I’ve been talking about this for a long time, but it’s getting, we’re getting closer and closer. Eventually we’re going to have that big financial reset and it’s either you’re ready for it or it hits you and it’ll be almost too late to do anything. A lot of people don’t take action until it is kind of too late.

They’re already down 40, 50%. Like, what do you do at that point here? You’ve already done. The damage is done.

Okay, just to clarify here, so you’re not against all dividend stocks, you just don’t like the dividend stocks in the energy sector. Am I correct there?

No, this is just dividend stocks across the board. Majority of big investment capital is in dividend stocks. It doesn’t matter what they are. A lot of the dividend stocks though are energy.

They have big profits. Right. So my, my whole belief is, my point is if the stock market is going down just like a falling tide, all boat, falling tide takes all boats down. You do not want to be holding stocks, period.

Doesn’t matter if they’re dividend, high dividend. In fact, high dividend carry more risk than like the overall stock market in general. People don’t know that. So when the tide’s going down for stock market, just get out and go to a different asset class.

Which leads us to. There’s some way better opportunities, I think, for 2025, where I think there’ll be low volatility and lots of upside potential.

Yeah, we’ll talk about that in just a minute. But when you say that January is bad for stocks across the board and the, the correction that we got on Wednesday after the FOMC is not it. What are we talking about, Chris? This downward correction that we’re talking about in January, we’re talking about 20%, 30%.

Like, what does that look like to you?

Yeah, so I think January will be kind of like, I think we’ll start to see this market potentially go back up to these highs, maybe poke to nominal new highs. I do feel like we’re going to start to see it eventually flatline. You know, you have a series of things moving up. Eventually we’re going to have a break to the downside and it’s going to start the downward trajectory.

I’m not saying January is going to crash. I’m just saying January might be the top. We might see the highest high here. We might start to see it trade sideways.

And then I think 2025 is like, okay, we’re going have a series of like bear flags and it’s going to unwind. I do feel like we could see like a 35, 55% pullback in the S&P 500 over the next year or two. I don’t know if it’s going to be like a flash crash, like a 2008 versus a waterfall sell off, or if it’s going to be more like a 2003 year bear market. Multiple big waves and bounces.

To the downside, we’re not, we’re not going to know obviously until that happens. The key is just being prepared and having an action plan to avoid or take advantage of it.

Okay, so it’s interesting because you said that bitcoin might see 160k on the upside after a series of corrections, but that implies a 60% increase from current levels. Now you’re not saying the stock market is going to go up 60% in the next three, four months, same time period for bitcoin. Right. There’s a bit of a divergence there.

Right. So what I think will happen, and this is, I think, I think the stock market is going to try and claw its way up to the end of the year, might go a little bit higher into January and then I think we’re going to get into some big volatility. The stock market will start to be in this topping range. I think at that point.

Bitcoin and gold, as the market starts to get nervous, I think bitcoin and gold are going to want to continue to move higher while the stock market is kind of flatlining and potentially there’s going to be a divergence. They’re going to become a safe haven, play for a short period of time. But once the market starts to break down and starts to break like a low and another low and a couple of these lows and there’s panic. That’s when we’re going to start to see, you know, bitcoin and gold start to get pulled back and then they’re going to all move in sync together and they’ll all start to correct.

But there will be this sweet spot where bitcoin and gold should continue to perform while the stock market is actually struggling.

That’s interesting. So you’re expecting bitcoin and gold to outperform the stock market in 2025.

Okay, this, this is just like January, February.

It was like just, okay, just January, February. Okay, let’s just.

Very short term. I think we’re coming in Q1.

I, I guess we’ll follow up in Q1 to see if the. What your Q2 outlook is going to. It’s going to hold for us. Okay, let’s turn now to things that you do.

Like you mentioned that there are low volatility plays for I guess retirees seeking to preserve their wealth, not through dividend stocks. What else?

One of the plays that I really like, I mean I’m Canadian, so I play the currencies as well. I think one of the best plays here, we’ve seen the US Dollar move up and if you look at all the other currencies, they’re all moving down into the right. As a Canadian or really as any investor, I think it’s kind of very similar if you’re not in America is to look at the Canadian dollar conversion. I really like the US to Canadian dollar.

So I have all my investment account is in US Dollars because I believe the US Dollar is going to continue to rally. And based on the chart pattern of this and what’s going on, I think oil’s going to go down. When oil falls, we tend to see the Canadian dollar fall. It typically follows that commodity a little bit.

So I think oil is going to collapse, making a weaker Canadian dollar. When we have chaos in the stock market in the world, we see the US Dollar, you want to rally. So I think we’re see this big play here. Based on this chart pattern, I think we could see about A$70 to A$73 exchange, which is, which could be a record.

I don’t know if it, how far it goes back, if you’ve ever seen that, but there’s like a 20 upside move just to hold the dollar, the dollar currency in a brokerage account you don’t even need to put a position on. You can also buy though the dollar index etf, which if you’re already in US Dollars gives you even more potential upside for it to, to take advantage of it. So I like this play in. In 2022 when the stock market sold off, we saw the US dollar, US dollar itself, US dollar index rally about 18%.

If we look at this chart, you can see we had in 2022. This chart doesn’t quite just pull this up here. 2022, we saw the US dollar just scream higher and this was a play that we traded with an ETF. It moved up 18%.

The biggest pullback, these pullbacks along the way, the biggest one for the year was only 4%, less than 4%. So that’s what I like about currencies and I believe we’re starting another run higher in the US dollar. So to me, this is like a low volatility play. The crazier the world gets, the worse things get, the stronger the dollar should be.

And it’s, it’s a great way to take advantage of things. And if the dollar goes up, it’s going to hurt. It’s really going to hurt the economy. It’s going to hurt multinational companies.

Because now everything in US dollars is super expensive for other countries to buy. It’s going to hurt commodities like gold. So this is just, I think, a part of that cycle, a cleansing event. And this is one of those low risk volatility plays that you can slide into and not have to like really panic about.

Huge moves.

Yeah. I’m glad you brought up gold because historically gold and dollar don’t move together. And this year was a bit different. The many bounce this year that they’ve moved in tandem.

My question is why you think gold will still perform well in 2025 if you think the dollar is going to do well?

Okay, yeah. Well, yeah, so I don’t think gold is going to do well in 2025. So.

Okay, so you think. Okay, hold on, let me just. You think the stock market will do the worst. Gold maybe just a little bit better and then bitcoin really well.

But.

Okay, so my, my scenario, what I believe is going to happen is I think we’re going to go very similar to 2007. I think we’re going to 2008. We’re going to see gold pull back with the stock market. I believe we’re at this point, stock market is going to.

Correct. We’re going to see gold pull back 15, 20%. And then, and then once the stock market has cleansed and gold’s pulled back, I do believe gold will be a top performer. It might not be till late next year.

Who knows? It depends how long this bear market phase lasts. The 2008 one was a very quick correction. It was like an eight month or so somewhere in there.

10 month. So I think maybe by some point in 2025, gold will put in a bottom and then become one of the most exciting assets to be in, I think to the upside, especially in the precious metal miner space. But when the stock market pulls back, gold is going to pull back. Also, gold is only, I think, going to move up just a little bit over the next one to two months as the stock market is cresting, about to put in a major top.

So I think gold is going to be sideways, slightly higher for the next month and a half after January, I do think almost everything is going to go down and the dollar will be one of the most conservative, safest plays that there is.

How do you feel about the Canadian dollar? We’re both Canadian, and I’m bringing this up because there’s a bit of turmoil now in Parliament. Christopher Freeliam, Finance Minister, just resigned this past week. Cabinet ministers, even within Trudeau’s own cabinet, are calling for Trudeau to resign.

Forget the opposition. So this is interesting. They might call in somebody else to. They’re talking about calling in somebody else to take in Trudeau’s place before the election.

So lots going on in Canada. How do you feel about the cad?

I don’t know what’s going on in Canada. I don’t follow politics too closely because it is just absolutely ridiculous in my opinion. But I think, I think we’re in for a world of hurt. I think Trump and tariffs could cause a problem.

I think we’ve got all kinds of our own mess here with Parliament and we need a change of hands, change of guards here, for sure, shake things up. But I do think the bigger cycle at play is the global, the economic cycle. I do think we’re going to see, you know, the Canadian dollar fall in value based on the, on the U.S. you know, and I’ll pull up the Canadian dollar because that’s what you were just mentioning.

If we look at the Canadian dollar, I think we’re going to continue to see it fall in value. So if we look at the, the, the monthly chart and go way back in time here, I think the Canadian dollar is going to go way back down to like, you know, 65, 62. Somewhere in there. It’s gonna, it’s gonna sell right off and it’s, it’s gonna be pretty painful.

I think we’re going through a very painful. I think we’re gonna have a big recession and it’s gonna kind of feel like a mini depression for a lot of people. There’s going to be a lot. I think it’s going to happen, I think in, in most countries, to be honest, I think it’s not just specific to one place, but I feel like Canada is already in a depression because it’s just, it’s run so crazy and we got lunatic running the place.

But I guess every country could probably say and feel the same thing about their people.

So a lot of it may have to do with the fact that us 10 years just been rising a lot faster than the Canadian treasury. Not, well, not so called treasury here.

But yeah, our rate, our rates are falling faster because of our, the way our mortgages are, our banking and our structure here. Yeah. So it’s going to be very interesting. We have a little different dynamic.

I think our housing market could get hit very hard a little quicker than in the US Potentially. Just the way mortgages expire every like three to five years on average and the rates are not, are still really high and people just can’t afford the new rates on renewal.

Yeah, that is tough. Housing market. We’ll talk more about the housing market in another episode. I think we’ve covered a lot of ground already.

But final question, Chris. We’ve talked about what to do if you’re a retiree. Stay away from dividend stocks, stay away from energy stocks. What if you’re somebody young who wants to speculate.

We talked about Bitcoin. Is there any other sector besides Bitcoin that I guess people with a little more risk appetite would want to venture into for Q1?

I don’t really feel like, I don’t feel like there’s an asset like it. Just because you’re risky. I don’t think there’s anything you can just jump into. I think the key here, if we just look at this, this is like a, such a simple basic cycle we have right now.

I believe we’re at like peak maximum risk. It doesn’t matter what you put your money into. I don’t think there’s a lot of upside. So just because you’re risky doesn’t really open the doors, I think, to anything else.

I mean there’s not a whole lot there. I mean to, to get involved. And I think if you, if you want to be more risk adverse, I would, I’d be more inclined to potentially look to buy an inverse ETF on the, on the energy sector once it breaks down a little bit more over the next month. Come January, it might break down and create a bear flag and that would be the opportunity to buy like Ery, which is like a three times, I think inverse ETF and you could make like 50 to 70%, you know, on a beautiful washout, huge sell off in the energy space.

That to me would be more of an exciting play. That’s the one that’s standing out as a very high volatility play. It’s not quite time yet. The energy space just fell 14%.

It’s ready for a bit of a bounce and pause. But the next leg down will be the start of something much bigger. You know, as you and I have touched on this before. I believe we’re in this kind of stage three topping phase.

And once we break down, which I think is going to come in 2024, this is when we can buy inverse ETFs in general to profit from the falling market. But if you’re aggressive and you want to do something right now, you kind of got your hands tied because we’re. The markets are still up. I don’t think there’s much upside and nothing else is screaming that it’s just going to take off.

Like the Bitcoin 160. I wouldn’t get caught up on that. I highly doubt it’s going to happen. It already hit our measured move.

It’s pulling back. To me, that move is done. It’s just if it was to go parabolic and go ballistic, that’s the next spike up. But don’t I know people are going to take that 160 and be like, I’ll buy Bitcoin.

But that to me is like, that’s actually a bad trade. That is just a prediction going forward. We don’t have a new chart to draw that very clearly where that next level is just yet.

Okay, so, Chris, I want to thank you so much for being a part of the show this whole year. Good, timely updates. People could check out the last interview. So where can we learn more from you in the meantime?

Study your work, learn how you trade?

Yeah, sure. Well, people can go to the link below in the description to my website there, the technical traders and you’ll see that I share videos of the markets every day with subscribers before the opening bell. And really what you’re doing is you’re learning how to follow the markets. You copy the trades that I do, which are ETF trades and I provide portfolio allocation, the entry, the targets, all of that stuff.

And so really I ride the coattails of the markets. You ride my coattails. And I really give you the best possible trades because I’m managing my own capital with it and it’s a great community. We all chat and we can communicate inside.

And again you can just go to the link in the description and check it out.

Excellent. Thanks very much, Chris. Merry Christmas, Happy New Year. And yeah, we’ll speak again soon.

Great, take care. Bye bye.

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