Last Saturday, I was at my seven-year-old’s baseball game.
At this point, he is still more interested in what kind of snacks come after the game than how to turn a double play, but it’s fun to see him out there.
This is the first year for him that you can actually “strike out” after 3 swings rather than unlimited chances, so that’s a big change. There’s nothing worse than a strikeout, and he had two of them in his first game.
But he quickly turned it around and has been hitting the ball hard the last few games.
And I’ve noticed my perspective has shifted too.
After seeing him strike out right out of the gate, I didn’t have a lot of hope the next time he was up, and he whiffed at the first two pitches.
I was “bearish” on his chances of getting on base, you might say.
Since then, he hasn’t struck out once. He’s hit the ball hard about 10 times in a row…
And, like I said, my perspective has shifted with his results.
When he whiffs at the first pitch now, I don’t expect him to strike out. It’s just a little bump in the at-bat, and I think he’ll be fine.
Amazing how quickly that shifts.
I think the stock market is the same way.
In early April, everything seemed negative. Any signs of bad news — we all immediately believed the worst.
Just 6 weeks later, it’s the opposite. We shake off bad news and say, “Hey, the market is on fire, it’s just a bump in the road.”
And yeah, the market is batting nearly a thousand the last 6 weeks.
It’s up almost 20%!
And now we have a red week on our hands…
Well, as Graham shared on Opening Playbook, this is probably due. The CBOE Equity Put/Call Ratio dipped to its lowest level since February — meaning signs of excessive greed. And CNN’s index agrees:
But to me, this is just like my son Jack.
The market is hot right now. It can shake off some selling pressure and even a Trump social post.
So I am optimistic until proven otherwise.
I remain convinced we’re headed toward new all-time highs before the next major correction. Here’s how I’m positioning:
-
- MAGS (Roundhill Magnificent Seven ETF): The “MAG7” stocks have underperformed the broader market so far — MAGS is still down over 12% year-to-date. But if the market is going to break out to new highs, these mega-caps will need to lead. MAGS lets you play the group without picking a single name.
- XLF (Financials Select Sector SPDR): After a brief flush, financials are sitting right at key moving-average support. I’m looking for a bounce back in this sector. Another one I believe will also be at all-time highs sooner than later.
- IBIT (iShares Bitcoin Trust): Bitcoin remains the strongest asset class out there, and I am buying on every pullback right now. I like BTC to hit $120k in the next 3 weeks.
— Nate Tucci
