Okay folks, so this may be the single most intense week we've had this year, and I know that's saying a lot, but it could be true. If you were to choose one week to pay attention, this would be the week. First of all, we need to discuss the historical context heading into this week. Secondly, we need to talk about the massive onslaught of earnings reports that are coming out this week, as well as big catalysts that are coming out midweek wednesday, and Thursday specifically.

And thirdly, I have some crucial dates for you in regards to popular squeeze stocks. I will put the timestamps below, but let's get right into it. So we are in the situation where the S P 500 is having its worst start to a year since 1939. Later that year, Just for context, World War Ii started, you look at the Nasdaq.

You're now down almost 25 in the overall index since highs back in late November. These are the levels that we first hit and earned back in late 2020.. And you look at the stats on Nasdaq Bear Markets. The average Bear market is 35 down and lasts 198 days.

So far, we are at again around 24 down, but are 168 days in. So if you're looking at these stats and you're thinking this will also be an average Bear Market. That means that we're deep into the second half of that Bear Market. But of course, not many people think this is an average Bear Market.

No, No, no, it's pretty staking clear that equity markets are pointed downward as long as inflation is out of control. and then as long as we are dealing with ramifications for what it's going to take to bring inflation down and back into control. And of course, context, though, is always key. You look at this period of long-winded Bear Market recession in 1973, which lasted 630 days.

That period of time took indices down almost 60 percent. Well, guess what was also happening around that time period? Well right before that in the late 1960s, you had the Federal Funds rates rising from about four all the way up to nine percent to slow down inflation. And then when 1970 hit, those rate hikes caused the economy and the market to fall into a recession, which brought inflation down and caused the Fed to say okay, well, now we need to stimulate. They ask themselves what's a level at which we can drop rates to that the market just can't help itself but rebound from And by June of 1972, we were down as low as 3.3 So that was the magic number they chose.

But then inflation got out of whack again and they had to start raising rates again. And this time they went as high as 1292 and you had another cycle of lowering it. And then finally in the 1980s, you got Paul Vlocker who finally said enough is enough and raised rates to 19 at heights, which shocked the system and fixed the problem for nearly decades. But what I'm getting at here is the transition of the relationship between the Fed and the market and the overall economy.

and really, the financial system. Each time you had a recession, what did the Fed do? well? they responded by stimulated. Makes sense, but the degree at which they had to stimulate was based on the economy's tolerance. For example, again, after 1970, they lowered it to 3.3 After the 1974 recession, they lowered it to 4.65 In the early 1980s, they had a blip where they lowered it to nine.

Then in the 1980s, they lowered it to 5.85 90s, Three, two thousands, one post 2008, just above zero. And then obviously in this last previous period, just above zero. Now look at this chart and think about it from the standpoint of the financial system being an addict. If you become addicted to something, it takes more and more of that thing to be just as stimulated.

When I was starting college, I had my first cup of coffee. I felt euphoric and amped up, and I couldn't sleep that night today. I'd probably need five plus of that same cup of coffee to feel the same way. So whereas one cup of coffee was stimulating to me back then today, it would actually be a drag if I only had one cup of coffee.

And in order for me to get back to that tolerance level, I'd have to shock my system by dramatically reducing or eliminating caffeine for a stretch of time. And that would be a very painful process. In a similar way, the market has been so stimulated for so long that the 5 interest rates, for example that stimulated the economy of, say, the 1980s, wouldn't be stimulating today. Just like one cup of coffee isn't stimulating to me anymore.

In fact, if we went to 5 interest rates, that would be devastatingly hawkish. Financial System right now is an easy money junkie, and because we've been given it all the easy money juice that it's needed, it's all the way down here now, and that tolerance is incredibly difficult to reset. Howell tried to give it a tolerance break back in 2018, and the market, through a little fitty fit. Imagine how the Fed back in the 1980s would feel if you told them, oh, three percent.

That's too hawkish. People say three percent. Oh My. God.

companies can't operate at three percent, The economy can't operate at three percent. And the reason is because the economy is addicted. It's addicted to easy money. And this is all to say that if you want to make a prediction on where this ends and where we bottom, it's almost entirely dependent on when the Fed has decided that it's taken enough of the extra junkie supply away from the market, and that's going to be entirely dependent on when inflation meaningfully drops.

At this point, not many people think that the Fed is going to go for a stronger tolerance break like we saw in the 1980s, but no one can tell you for certain what's going to happen, which is why this is such a frustrating time to be an investor, and even going back to the mid 2000s or 90s levels can be dramatic just because of the level of addiction to stimulation. That said, I am fairly stoic and I don't look at this data and ignore the other fact that this data shifts. if you look at the data and you match it up to recessions, I don't think that it's out of the realm of possibility that we get a few more hikes and it turns out the first quarterly contractionary report actually ends up being two quarterly contractionary reports. And then maybe you get a late summer or early fall jobs report that is way under expectations.

or perhaps jobless claims are going up significantly and then all of a sudden the Fed's like, oh shite, we're now in a recession and we have jobs numbers looking terrible At which case the Fed decides. Okay, well, we already slowed down the pace of rate hikes, but we're also going to pause it, or even perhaps reverse course. History does show that the Fed is never never persistent at raising rates during a recessionary period. The global financial system is indeed a overstimulated junkie, but knowing how much the junkie is going to fight back if you really take its supply away means that it's in the interest of the Fed and the national economy and really the global economy to not irritate the junkie too much.

Irritated just enough. Where maybe you get a recession, but you also get inflation starting to come down to benchmark. Okay, let's start with earnings. You start on Monday.

you have the tier of the Palin reporting before open. No love for growth stocks for quite some time in this market of Algo dominated trading, panic, selling, and de-stimulating from the Fed. Anything that's future growth based has been sold down massively and it's going to be tough for them to find a bottom. Unfortunately, Not to mention, growth companies actually need time to work through their growth hurdles and this market doesn't want to give them any time.

But someone messaged me in Ziptraderu the other day and asked Charlie. With nearly every Grove stock and even the bigger growth stocks tumbling down dramatically over the last three months especially, but really, over the last like 12 to 15 months, how do you separate the ones that deserve your conviction as Dip buys from the ones that don't. How do you decide which ones are worth, for example, your capital holding? If you look at the data, most of these stocks are just sold based on how forward-looking they are, and they're almost sold equally. bad company or good company, which of course defies logic and provides a lot of inefficiency opportunities.

But you have to know what you're looking for here and the way that I see it is. they need to follow rules in order to deserve your conviction. They need to be able to keep their high growth rate trend and or have high cash holdings. Ideally, both those are the ones that I believe are most likely to survive if this does become a bigger recessionary trend, in a bigger, tighter financial market and not only survive, but also see outsized growth on the other side.

And to me with volunteer, it still fits this criteria pretty damn well. Its year-over-year revenue growth rate is 41, which is 2x the sector median and more than 10x the 10-year average of the S P 500.. in terms of cash and assets on balance sheets, they are stacked. so with balance here, I'm not super reactive.

If anything, I think that the lower goes the better. I get the titles. Oh well. Dipbind is bad because markets are stubborn right now.

Well, that's fine. But if you have your highest conviction stocks that you yourself believe in not just somebody else believes in on a youtube channel, then all of a sudden you could say okay, well if I really believe in it, then I like it at lower prices regardless of the market condition. No one's going to be able to tell you how low these can go until you actually get that inflation data starting to turn around. But if you love the business models, I say just follow the progress that they're making and project moving forward.

once you get out of this crud that we're in. And for me specifically this week with Valencia, I'm looking for top-line growth in their commercial segment. That's the one thing that I really care about. Okay, Monday after close we have upstart Amc Plug Atra, Blink, and Lemonade.

Upstart is one of my higher conviction plays. We've called Cycles very very well in that in the past, but now we're back at 52-week lows and struggling. This is an example of a company that has a platform with a ton of proof of concept in both useful execution and in getting customers. but with the multiple crunch and specifically in this industry lending demand going down, it's going to go through some bad macro factors and it already has.

But on the other side, whenever that happens, I think this is going to be one of the most exciting place. We'll see what their overall trend is looking like on earnings, but then also importantly, you have squeeze and retail stocks like Amc and Outer Gator reporting on that day as well. Anything that brings attention to squeeze stocks is good because that's what they really need to get more momentum. Attention translates into New Capital Tuesday the day of twos you have after close Sofi, Roblox, Coinbase, Unity, Rocket, Win, and Matterport.

Some of these I'm most interested in so far from a lending perspective. Of course, they're not going to be doing very well because the bottom administration halted their main lending segment or at least one of their most traditional lending segments the student loan segment. And of course, as rates go up and people are a little bit more uncertain about their future, people aren't borrowing as much, which causes financing and especially refinancing demand because you're not going to get a better rate than what you got six months or a year ago to basically plummet. But I think their main claim to value is member growth because member growth is what's going to make them a good company over the long run, right? Because the more members they have and the more accounts that they're creating, all of a sudden you get into the situation where you can cross-sell them a ton of different products.

That's something that makes companies good over the long run. Of course, most people would say, well, what are they doing right now and what's the current condition? Well, if you're thinking that way, I would focus more on trading opportunities and not conviction, right? We have a focus on both. You have your conviction stocks, then you have your trading hype plays, right. But if you're focusing on the market condition, you don't want to be focusing too much on the fundamentals.

Because when you're talking about fundamentals of especially growth finance companies, you're not going to be in a good place for a while. Coinbase: I'm also interested in Crypto. Demand has slowed down a bit. How are their numbers looking now? Options trading shows a strong chance of a big move, probably 15 to 20.

Interesting trading opportunity. Wednesday before open, you have Evie Go and pay safe. I think Evie go. If it keeps getting beat down, it's probably going to be a solid buyout candidate.

You're seeing a lot of companies go and acquire smaller companies that have been beat down to oblivion, because obviously when things get really, really bad, it's easier for a company to just go buy the discount on a beat down stock of a competitor that has their technology that they want instead of just going and having to go and build it out themselves. Wednesday after close, you have Disney, Beyond, Meat Rivian, and Koopaing. Thursday before open you have Varu, Bkkkt, and Hcdi. The thing these three have in common is they are all historical squeeze momentum stocks.

Here's your Varu, your Bkkt, and your Hcdi. Very pop and dumpy hype and die cycles. Earnings can re-catalyze them, but what I'm really looking at is Hcdi. I did a breakdown video last week after it did its massive sell-off, but I ran the numbers and I felt that the short sellers are getting very, very over concentrated on the short side here, and I felt that earnings coming up this week may be an interesting catalyst for the stock.

and then after close on Thursday, you have a firm and Acb. Quite frankly, I would argue that this week it's going to be more indicative of how businesses are doing, but you're not going to see a lot of valuation increases for companies that even beat on earnings, especially growth companies. I was reading Draftkings earnings from last week and the company reported strong sales that they weren't faced by inflation. Raised their guidance for 2022, which most analysts said that their guidance was going to plummet, but it didn't really matter what Draftkings reported, right? the market doesn't care.

It seems like if anything, good earnings just trigger a ton of sell orders because people are like, oh good. I can get out of my position now so I don't have to hold through more fear, uncertainty, and doubt. The next year or so people in today's market see good earnings as an opportunity to get out sooner. That's just the market that we're in and that happens every so often.

Moving on: inflation report: On Wednesday, you're going to get the next infamous Cpi report, and then on Thursday the Producer Price Index. Now for Cpi, look very, very closely at those core inflationary numbers, which is minus food and energy. The Fed's meeting last week leaned heavily on this idea that core inflation has peaked and they based their decisions and their rhetoric on that one prediction and forecast. If that forecast ends up being wrong, expect the market to really freak out.

You could have the overall Cpr report continue to heat up, and it probably will, but if Core drops, the market's gonna be like, okay, well at least that's working if it goes up okay. Finally, squeeze setup dates to know: Varue Varuvivaru May 10th they have a pre-emergency use authorization meeting. If they eventually end up getting pre-emergency use authorization, you expect a big big swing. Upward Developments can be revealed on the 10th.

we'll see they also have, of course earnings on the 12th Big Squeeze Stock. Lots of proof of concepts in terms of the history. Let's see if we get any rocky rocky today and Spiky Spiky Atra of course has earnings on Monday the 9th. Hopefully we don't hear anything about an offering, but that could be on the table.

Amc has earnings the same day and there are also some dark pool investigations from the Sec into overall dark pool usage, which is something that's often discussed about when it comes to the top of the meme stocks. So perhaps this will be a week that Amc finally gets some highlighting. And then of course Bbig, which I know a lot of you are excited about. They have a record date for shareholders looking to participate in the Kryptide spin-off on May 18th and then the expected spinoff is actually May 27th.

When the company announced this last week, the stock went parabolic as this is something we've been waiting for for a long, long time. so it's basically the Fall of 2021 Record date is not this week, but the week after, which means that this entire week people are going to be able to speculate and media coverage is going to be hot, and you're going to get opportunities for pre-anticipatory runs. According to the press release, each Vinco venture shareholder of record as of the close of business on May 18th will receive on the distribution date one share of Kryptide Common stock for every 10 shares of Vinco Common stock held. So if you want to participate in the Kryptide spinoff on the regular market, you have to buy in by that record date according to this filing.

which means people are going to be speculating on folks buying in before the record date, and then of course the actual spin-off, which people are anticipating to cause a huge increase in the risk profile to Shorts. As of course, the spinoff could create momentum in the stock, and also when you're short-stopping generally you're responsible for paying out the cash value of that dividend. In this case, if it's a special dividend like a Kryptide share, a spin-off of a business entity that may be the cash value of each kryptide chair, which I believe is like five dollars and you pull up the top three stocks. right now, Bbig is right here just below S P and Gamestop, so it certainly has the goods to get a little spiky spiky.

And we didn't even talk about the options chain, which we'll be updating you more on if we do see some proof of concept in the next couple of days and we see some of that open interest start increasing Anyways, folks, have a good rest of your day. I'm looking forward to spending another week with you. If you have any questions, feel free to reach out to us below or join us on Ziptrader Circle. If you're looking to learn how to trade with our step-by-step lessons, private chat, daily morning briefings as well as our full price target list, I'll go ahead and put a link to Zip trader you below coupon code: Charlie Fever If you're looking to get up to five free stocks and a share of Twitter and also a double probability of getting a share of Facebook.

if you do it in the next 30 hours or whatever it is from when you watch this video, make sure to check out Moomoo down below. Terms and conditions apply Anyways, have a good one folks and I'll see you in the next video.