Okay folks, so we have some big Market catalysts that are dropping in the next couple of days and we need to discuss exactly what they are and what you need to know about them. And then I'm going to discuss exactly why the period that we are entering into this week is going to Mark a huge turn of the chapter and is going to be one of the most insane, volatile, and consequential periods in the stock market all year. And I know that that is saying quite a lot, but I have the receipts to back it up. I will explain exactly what you need to know and all of our time stamps are down below.

Also a strong shout out to MooMoo and their 10 free stock promotion valued up to 2500, but I'll talk more about that later on. Okay, let's go ahead and start with the market situation heading into this week, so we know the context of which we are building from. The best way that I can describe this Market that we've seen over the last week is a calm within a storm. This is a heat map of the three month Returns on the S P 500 AKA What stocks in the S P have done over the last three months and you can see some pretty glaring red in technology communication Services Consumer cyclical Financial Basic utilities, industrial, consumer, defensive, and so on, and so forth.

Even energy has been a little bit slow the last few months. Here is the year to date, though obviously a more extreme picture where you have stocks like Amazon down 30, Microsoft 20, Apple down 17. The only segments doing well are health care and energy and then you look at the last week bouncy. Make bouncy.

It's like a little bouncy house. Pretty much green everywhere with the stocks that have done the worst this year ending up doing the best this past week. The only trailers are pretty much that energy segment which recession fears have started taking prices so people are worried about a bludgeon on demand and thus less profits for these types of companies. Same exact reason that you're seeing the Industrials and the utilities and the basic materials declining at the same time.

though that drop off in Energy prices and overall energy commodity has caused people this past week to say hey, maybe the FED is going to be a bit more dovish than expected at the next meeting or two. Maybe in the short term instead of getting a 75 basis point hike or a 100 basis point hike, we're just going to get a 50 and then maybe you get another one of those contrarian rallies that lasts a couple of weeks and causes a lot of short-term Alpha focused trading, hedge funds, and overall short-term money to Pile in and try to trade off that. Trend Try to trade off an overall squeeze on the market, a market that may have gotten too bearish too quickly. If The Fed does end up not being as aggressive as the market is priced it.

This isn't me saying that. That's what the market is saying this last week. On the broader Trend, the S P 500 is testing a change into an upper direction that it previously and especially failed to achieve at the end of June Here, and if you look at the bigger picture, it hasn't had any sustained and aggressive fake out since. essentially March there was this fake out in May but it was very, very weak.

And that is to say from a market perspective most of the last quarter. really, you have had most of the participants moving to move stocks down via either selling Holdings or dumping share short and when that happens so consistent and consecutively without any sort of sizable contrarian rally other than a little bit of a hiccup and a burp. Well, if that happens for a long enough stretch of time, eventually you get overdue for a contrarian rally that is sizable. I've shown many graphs, but if you look at Save the.com bust, you had so many contrarian rallies your head would spin off.

There are periods of time that were so damp, contrary, and that you got six months of a bull. Trend Yet this time you haven't had any real sizable contrarian breathing room. Again, a small one in May But the only one we really had is that bigger, more sustained one in March after the first Fomc Hike meeting. So I mean part of me feels as we test these breakout levels over not just late June's highs and failed attempt upward, but also the overall downward direction under our red directional SMA and failure to really break out for above that that there's this General energy in the market now present.

that says we are basically overdue for a contrarian rally. You feel that General Okay, we're bearish, but hey, how bearish how quickly can you be And that's the kind of energy that is vibrating throughout the market. especially this last week. Now, while I do feel that energy I have to tell you that you look at the cycles and it's a little bit different.

You look back at the recent history of the market and the Playbook that we've seen all year. Remember, this is what we've seen again and again. You see markets dopping prior to a Fed meeting. but then after the FED meeting, markets rally as the FED has chosen to do the bare minimum to fight inflation and markets get more clarity which causes them to what rally.

And if you look at the S, P, 500 or triple Q chart after that June 15th Fomc meeting and also when we posted the video talking about how this is the cycle that always plays out, well, guess what? that cycle played out exactly Again, you look at that overall trend. We exactly got the same thing where after the Fomc meeting that Market's tagged on prior to, well, all of a sudden you get the bouncy bouncy. But then eventually where does this step in the cycle lead? Well, you just look at the first tier, Well, step one repeats and all of a sudden new data comes out and it looks bad. That bad data.

Trend usually starts with the CPI which is released on Wednesday or it starts with the PPI which is released on Thursday and shortly after that markets Digest Us these inflation reports by essentially taking expecting the FED to have to be even more aggressive at the next meeting. but then the FED ends up doing the bare minimum again and stocks rally afterwards. So it's like from a technical standpoint we are testing a crucial breakout point for a contrarian rally, but from a Fed Market cycle standpoint, we are in a normal cycle of General rallying after a Fed meeting and thus due for another bad day to take in cycle. My thoughts because you can't have it both ways.

Well, my thoughts are you're probably going to start seeing a more blunted reaction to the inflation narrative, not just this week, but over the upcoming months as well. And the reason is because now we're going to be a lot more earnings focused. Earnings season starts this week. But there's also the other argument which is that inflation is going to lose its front runner status as the biggest problem.

Why? Well, firstly, the CPI report released on Wednesday is expected to be slightly hotter than the last report, which is bad 8.7 year-over-year versus 8.6 percent year-over-year that we got last month. But there's also this General understanding that, hey, wait a second. Okay, great. We're about to get the report court for June and energy prices were really hot in June, but Energy prices already have in a very, very less expensive Baseline for July.

Which means that the report that we get this month in June is probably going to be a short-term Peak and perhaps the last peak of accelerating pricing pressure. If inflation's no longer getting worse, then the pathway that the FED has laid out for the next two years is going to be more likely to be hit and not be more hawkish. It might be more dovish, but not more hawkish. The FED at the very least, isn't going to raise rates a lot faster than it has said if inflation does start going down right.

So once inflation has started convincingly peaking all of a sudden, Boom the multiple crunchy narrative is behind us. We've already crunched multiples and everything is good from that perspective. But then the other side of the equation is okay. Well, great multiples on earnings are now set more in stone.

But what about the earnings themselves? And all of a sudden you have the sell-off based on earnings. And when you go back to the main point of this video, the reason that this week starts the most consequential week for the entire year in the stock market is because this is why when earnings wait starts. This is the start of a new chapter where markets are fixated on earnings, earnings, earnings, and not just on oh, the Fed and inflation. Here's the thing, We could talk about inflation and Fed crunching multiples on earnings all we want, But as long as companies are reporting numbers that aren't super disastrous, markets will have some support.

But the minute that earnings actually start coming under attack, that's when bottoms start falling down to Hell and sayings like shite even I wouldn't buy the dip on that I'm evil, not stupid. Right now, there's this general idea in the market. If you look at big caps that are holding up most major indices, there's this general idea that hey, these companies have already sold off 20 30 percent. They have factored in both a multiple crunching and an earnings recession, and thus they won't be bludgeoned much more.

even if they get a huge Miss on earnings or their guidance lowers quite a bit. Oh, hundreds and hundreds of big companies reporting in the next six weeks. Oh, don't worry, there's not going to be any huge misses on expectations there. Yeah, the Market's just going to be stable stable.

Little Sally You won't see any big companies Miss on earnings Wall Street has already guessed everything correctly even though they missed it the last couple quarters. Just look at for example: Netflix which is the poster child of Wall Street not being able to even price in big company earnings Netflix had a dramatic miss that missed even the most bearish analyst predictions. and starting this week, you are going to see an earning season start for hundreds and hundreds of major companies. And if you think that we are not going to see some shocking if not more shocking than the Netflix style drop in large to Mega companies.

Well, I've got a bridge to sell you. Well technically the bridge is on back order because of the supply chain shortages, but hey, you can order it. We'll get it to you in the next couple of years or at least by 2030.. But anyways, we know that any large to Mega company reporting a huge Miss on earnings can just destroy, just destroy the overall market and cause a few Day to a few week massive Panic cell that it just never bounces back from.

or at least not in this current cycle. similar to how Netflix and Meta and even the semiconductors sparked widespread panicking in the last couple of quarters. Similar to how even profit margin drops in Target Tarjay completely tanked the rest of the market as people are trying to digest the implications of that. But now it's about to intensify because we're now another quarter in things have gotten worse and all of these companies are reporting earnings.

Again, all these companies that lowered their expectations are now going to be reporting if they even met those expectations. I Think companies are going to range from oh, we're starting to see signs that were slowing down to oh man, my business is just completely tanking. But speaking of tanking, you know what shouldn't take the amount of free stocks in your portfolio? And yes, we do need to talk about the earnings. But first, we got to give you a message from our sponsor before we get into it.

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Okay, so as earnings season starts at Full Throttle What companies are reporting earnings this week? Well, you have PepsiCo on Tuesday I Hear they haven't been as effective at spreading diabetes this quarter. JP Morgan Morgan Stanley First Republic and Tsmc Semiconductors on Thursday Friday you have United Health Group Wells Fargo City Progressive BlackRock PNC U.S Bancorp and Melon. So the Big Dogs start really reporting at the end of this week and markets are going to have their eyes glued on what these companies are saying. The banks tend to have their nose on all of the economic warning signs and red flags faster than every other company because that's kind of their business to know what's going on and so you want to pay very, very close attention to that because markets pay very close attention to that.

You go over to the calendar from Interactive Investor. the next week you have Bank of America Goldman Sachs IBM Netflix Johnson and Johnson Tesla at T American Express and Verizon. Again, you get something like a slight disappointment to a big disappointment from Bank of America or Goldman Sachs or IBM. Or you even get more accelerating of a downtrend from Netflix and uh, markets are going to flip out I Don't care if every single company here reports decent numbers if one of them just really misses Wall Street Expectations You're gonna see a bloodbath and that's what I think a lot of people don't understand.

People are looking for reasons to freak the hell out. Right now. people are looking for reasons to say. Okay, the FED is just destroying everything.

Let's get out before it gets worse. and then you look at something like a Tesla on Wednesday I've been talking about how I'm a little bit worried about the valuation over here in this kind of Market condition. I Get that Tesla's China Factory is firing back up and they just reported delivering a ton of new vehicles in China and their overall trend the last five years is great. but right now I mean their deliveries dropped by 18 in Q2 overall first down quarter in a while and profit margins should start getting crunched.

I Think the remnants of 2020 and 2021 froth are still very present in Tesla and a lot of people that should be investing for the long term are going to sell at the very first sign that this is going to go down a lot. and if you get a big mess this next week when it comes down to especially earnings guidance, all of a sudden, I would be very worried for the overall Market impact on that, especially considering how Tesla has made its way into being one of the biggest players in the S P 500. The week of July 25th you have 3M General Electric Coca-Cola McDonald's AMD Alphabet Microsoft Quantumscape Teledoc Visa I Am of the opinion that this day on July 26th is going to be a bloodbath. I Think if every single one of these companies again reported decent earnings and One Missed Boom the Market's going to freak out I Think that you could easily see Alphabet report more decelerating in their advertising spend space I Think that Microsoft could see a Slowdown a bigger slowdown, so definitely a possibility.

Then the next day you have Boeing Shopify Spotify Spotify 5 Ford Meta Qualcomm I Think the big Shockers that day are going to be from Boeing who are likely still struggling for manufacturing. slow down didn't slow down in demand Ford Same problem Meta which is getting killed as advertising spending dies off. Thursday Pfizer Twitter Apple Intel Snap Chevron Exxon Procter Gamble Apple No longer has that stimi money that went to the economy and gave people money to go and buy part of an iPhone or a new Macbook. So I think that the year-over-year numbers are going to start looking pretty damn bad Intel Similar problem with less Demand on them as a supply chain carrier Snapchat Ad spending business is of course going down Friday You have some gas companies and Procter and Gamble and Caterpillar.

and then the first week in August you have more heavy hitting Tech you'll see PayPal Starbucks General Motors Roku Uber Lemonade. MasterCard Amazon Block Lucid Plug Twilio In terms of heavy headers really the main one is Amazon and then small cap earning season starts the week after that. But the point of starting this week? we are heading into the most consequential period for the stock market that we've seen all year. At the same time, or at the end of the month, we have another Fed Hike decision and we have that Q2 posting which is either going to declare us in a recession or close to one.

Next, let's go ahead and talk about the Catalyst that I am watching this week. Put these on your radar folks. So Monday you have fed President John Williams Speaking, expect headlines talking about his take on the chances of a recession. He recently said that he sees growth lagging below one percent in 2022 one of the more bearish members I Think there should be more bearish members, but hey, he does think that growth's gonna lag and he stressed that he supports a 75 basis point hike in July On Tuesday you have Thomas Barkin who tends to lean a little bit more dovish I'm interested to see his take on the commodity cooldown, and if he's leaning towards slower rate hikes I mean I would put it past Mr Barkin to spark a one-day rally in the market.

Oh, we don't have to race as fast as we thought we did. and then the next day we have to race very fast from another Fed member. On: Wednesday you have the June CPR report. it's expected to be 8.7 percent growth year over year.

Thursday you have the next round of weekly jobless claims reporting the June Producer Price index, which is another consequential inflation report and then you have Fed Governor Christopher Walder talking. Then Friday you have the next Consumer sentiment index the next consumer confidence index you have. you have Fed President. Bostic Speaking you have June retail sales, business inventory reports, and industrial production reports coming out.

So I think that net and in effect. This is going to be another week where you get some real data, you have the start of earnings, and then you have all these Fed speakers coming out and trying to groom the market with new expectations. Now remember, the FED likes to work a lot with their soft power, which is how they speak to the markets and cause them to tighten on their own without the FED actually having to go out and raise rates even more or unload even more off the balance sheet. And we've seen in the past where you had big periods of bull rallies in the overall market like like after the March FMC meeting rally where all of a sudden the Fomc members come out and they start saying negative things like they're going to be more and more hawkish and all of a sudden boom tanky tanky.

So keep in mind what the FED says on these meetings is going to be very very very consequential for the market. and I think with some fairly recent healthy economic data that came out last week that suggested that hey, we're still at pretty low unemployment numbers and things are still strong. From that standpoint, I Think this is the last time where they can really use their soft power the heaviest. Don't forget what the data says though, unemployment finds its lowest trough right before the FED starts tightening and shortly after you see a huge huge uptick in inflation.

Politicians as you know, like to use record low unemployment as a way to say hey, we have a very low likelihood of a recession, but record low unemployment combined with Fed tightening is actually one of the biggest indications of an impending recession over the last 80 years. So when people say oh hey, you know what, You can't have a recession if you have record low unemployment. Well, actually, the history suggests that if you have record low unemployment and the FED has started tightening, well, you just troughed and you're about to go into a period of record high unemployment. That's at least what the last 80 years of data says.

doesn't guarantee that it's going to repeat itself, but that's what it says anyways. that caps off the video. Let me know what you think down below: Are we heading into more bloodbaths or is this just the Calm before the eventual mass of bull rally? Make sure to hit that subscribe button if you found this video valuable. If you want to get up to 10 free stocks with Mumu and want to try out an excellent trading app, make sure to check them out with our link down below.

That capped out today's video. I Hope you had a great weekend and I'm looking forward to spending the week with you.