Speaker 1: 0:00

Felix, there is so much fear out there, so much worry and concern, and most of that is caused by bad information or misinformation or just a lack of understanding how all the parts fit together. Why? Because we just haven't been given any financial education right One of the great scandals of the last. Well, forever that there isn't any financial education. So what I want to do in this video here is walk you through the key things that mainstream media is missing what Wall Street's talking about. I get all these updates, some of the analysts and all the investment banks, and I talk to my mentors, who've all been on Wall Street and managed hedge funds and worked at all the big investment banks for 20, 30, 40, 50 years. So we got all this information, but everybody else out there just doesn't, and I think that's insanely unfair. All this information, but everybody else out there just doesn't, and I think that's insanely unfair. And especially in a moment like this, it's insanely important to have those tools, be able to spot those patterns, which is why I want to share the following with you here. First of all, what actually happens after a crash. That's our first item Very, very important. I will tell you what I'm actually buying today or why I'm buying today. I'll do both. And then there is something that I asked, um, I shan't name a name, but I asked a friend who works in the finance sector and said, like, do you think I should explain this to people? And he said, no, don't do it. And I said, why not? He said, well, most people might understand that. And uh, and really, why? I mean, isn't that sort of our thing? And I I'm like, ok, I'm definitely going to explain that to you. So that secret's coming your way. And I'm going to add one more to that because, well, this one, if I had told my friend that I was going to tell you that, he'd probably try to throw me off the ledge, but I think you can handle it. And well, you can tell me in just a moment. I'll also talk to you for a moment about inflation and why it's definitely not where you think it is, and then what Wall Street knows that they're not telling you, like literally just the key news item that you're missing out on. And I will tell you, for complete transparency's sake, what I'm actually buying today, because I think it's important to be transparent. It doesn't mean you should, but I want to explain to you what I'm buying and how, and then I'll give you a bonus chart to round us off. And you really want to watch out for that one, because that one's kind of super, super key here. And I think this is so important that, even though my Wi-Fi is literally down today, I'm going to upload this through my mobile phone connection because literally I have no Wi-Fi for the next 48 hours. Apparently Something happened with my fiber, I don't know, cat ate it or something, but I think it's that important that we're going to watch those little bits go up to you to make sure you are super, super well informed. So if that sounds good and you are an investor, then write investor in the chat. If this sounds good and you're a trader, write trader in the chat. By the way, you both have pretty much the same requirements for making decisions and rules and so on.

Speaker 1: 2:43

But let me walk you through what happens actually after a crash. So the market's down about 10% now, right. And what happens after you're down 10%? Let me get a slightly different color pen here. We're down 10% here. Well, we've had bigger declines in 2022. We went up 25%, we went down 33%, 90% and so on, but every time after declining 10% or more in the following year.

Speaker 1: 3:12

What does the stock market do? Well, it goes up a lot, and the more it goes down guess what the more it typically goes up by, right? Not the exact correlation, but pretty much that. And in the following three years and five years, wow, you see some really, really, really big gains, right? So what goes down must go up. That's for the market, that's not for individual stocks, and I want to talk to you about that in a moment. I think it's item number seven here, but this is the first one. Just take, take a little bit of the fear out there, out of the sting, so to speak. It doesn't feel good when your portfolio is down, but it also means it is likely to go up significantly over the next 12 months.

Speaker 1: 3:55

Now let me explain to you, then, why I'm buying today. This is a two-part thing. So the top end here I've got the S&P 500 chart, okay, and you can see how that's sort of zigzagging along, and we've had that big sell-off here, right, ooh, scary. And then I've got one more chart that most people don't really look at and they're not really aware of, and it's called VIX. And if you've been watching me for a little while. Then write VIX in the chat, because you know that's one of my favorite topics. But I'll tell you why.

Speaker 1: 4:24

Yesterday was an unusual day for the VIX. The VIX went down a little bit. Can you see that? That it actually went down a bit. You can see in the top left here. These are screenshots from Trade Vision. By the way, if you want to get access to the data directly, there's a free trial to Trade Vision down there. We've also extended our insane Black Friday offer to you to just help people out in these, well you know, unpleasant times by giving you really good indicators and really good data the kind of stuff you'd have if you're working on Wall Street.

Speaker 1: 4:51

So the VIX is down 3.3% here right now, minus 3.3%, and the stock market is still down 0.76%. Why is that unusual? Because normally, when the market goes down, vix goes up. Vix is fear. That's basically what it stands for in a sort of simplified way. So what can you do? Well, let me connect for you and I'll use a yellow line.

Speaker 1: 5:18

The moment when the VIX starts to decline, actually, we start on the left side here with that big spike here. That was the big spike from August, and then it's not 100% accurate. I'm slightly off here, but you see what's going on there. It's not the greatest line in the world, is it? But you can see how that correlates to this and we can draw some more lines if Microsoft will let us, they say, make them straighter. This is gonna be difficult, isn't it?

Speaker 1: 5:50

One of the toughest things I had to do today was draw some straight lines. So there we go. You see that connection, or even this one here, a little bit of a smaller one Microsoft, this is Microsoft's pen device. If you draw a straight line, you get a straight line. But there we go, there we go. We were managing it right. And then this one here, and you're starting to see what I'm trying to tell you. I think. There we go. And then now look at this one right here Crikey, why is it so hard to draw a straight line with this tool? This is Microsoft's AI at work. Can't get a straight line for love of money. Idea, right? I'm going to end my frustrations here before I throw something at the screen.

Speaker 1: 6:43

You get the idea that the tops on VIX down here these are the tops on VIX correspond to what the lows on the S&P. So why am I excited about this? What I'm excited about is that the VIX is going down and the S&P is going down at the same time, which implies that the VIX might have topped out and the VIX stands for fear, and therefore we might be at or near the bottom of the market. Now, you're never going to call the bottom of the market perfectly, and that's not really what this is about, but it gives you an indication of well, I don't aim to buy at the exact bottom of the market, I just aim to buy near it, near it, that's it. So maybe we're eight or nine-tenths to the bottom of the market.

Speaker 1: 7:28

That's sort of the way I feel it, driven by this set of data that I so cleverly and smartly draw some straight lines. You see what I struggle with during the day drawing straight lines. So what does that then say to you? Well, to you and, by the way, let me know if that makes some sense, like this right, like sense in the, in the, in the comments or in the chat, and I I understand that you're understanding this to some degree at least, which is all I ask. And then the next question, of course, is well, if we're near the bottom of the market. Shouldn't I be buying like matt? Well, if you want to know exactly what you want to be buying because that that'll be your next question I've put together a masterclass for you where I'll tell you exactly what all of those rules are.

Speaker 1: 8:05

To make this video as short as humanly possible, I've outsourced all that information that's taken me the best part of 13 years to acquire and I put it in here. And it's a 15-minute masterclass. It'll teach you three rules, because that's really all you need. You need three rules to start with when do you buy? What are the setups to that? What do you need to watch out for? What do I? And then, obviously, what to sell, so you don't become a bag holder again, like most people are at the moment. Right, if you're honest with yourself. So how do you get to that FelixRentzorg slash get free is the link to it. It's completely free. You like um. So if you're going to watch that, do it right now. That's, honestly, the best thing to do right now with your time. So this is what my um, my little finance friend, said um, he's not that little, actually, he's quite large. If I said that, um, he might, you know. Anyway, moving on swiftly. Hopefully he doesn't watch this video.

Speaker 1: 8:56

This is something that the guys on wall street and hedge funds talk about all the time. There is a trade that is so big we can actually see it in the charts, and I've made videos on this in the past and it's a trade that JP Morgan makes the bank that banks countries that's how big, they are, probably the most powerful financial institution in the world and they do this trade. It's called a collar trade and I don't need to really explain how that functions, but essentially, we know where it sits because it's that big. It just pops out. You can see it live if you go into trade vision. Should I pull that up for you? Maybe I should pull that up for you. So if we open SPX in trade vision, you can literally see that setup, which is one of the very cool things about Trade Vision, and you don't need to be an options trader to understand this or to access the data. It's just something that's very helpful and in the next minute or so, I'm going to break down for you exactly where that trade sits. Okay, you can see that big middle finger there from JP Morgan. That's where the bottom end of that sits at 5, 5, 6, 5. So you could draw a line in here and then, if you go up, you can see where the top end of that trade sits, and it's that great big finger there which is a massive amount of options essentially, and you can put a line in here and tell me if I shouldn't be telling you this because it's just too complicated, or tell me if you can handle it. So that gives you a range in which those guys basically aim to make money.

Speaker 1: 10:39

Now, this lower trade here, the 5565, so this red line here on the chart is so big that it acts as a magnet. So there is a magnetic impact here that keeps the stock around that 5565 mark. Is that the right number? Yeah, 5565. So what does that mean? So, seriously, go get yourself a trial to trade vision so you can actually see what Wall Street's doing. Right, because you can click on that and it'll tell you at least in theory you could click on that you have to move one of these down. So you can click on that and you can see that there are 40,000 options there. These options are not cheap. They're $120 each. You do the math on that $122 at the moment times, 40,000. That's $5 million in options. So each one of those options controls. So there are 40,000 options here. Each one of them controls 100 shares of the S&P and the S&P is trading at 5, 5, 6, 6. What is it trading at right now? Yeah, slightly around about that level 5, 5, 6, 5, times 40,000. This is $22 billion. Just one half of the trade is $22 billion.

Speaker 1: 12:07

So now you get a bit of an impression of how big a beast JP Morgan is. So it's magnetic and I've actually yeah, I asked Grok to explain this to me, like I'm five, it still made it fairly complicated, but essentially and it does it pretty well, grok's actually pretty amazing it says essentially, it says that, jp morgan, so the dealers have to hedge their positions when we get to that level and that buying pressure stabilizes or causes a bounce in the market, as we've seen when we hit five, five, six, four, I think yesterday and it rebounded. The only time this level was ever breached, the only time we ever breached JP Morgan was in March 2020, covid, and you know, the world is literally falling apart. Other than that, we never actually breach it. So it essentially has this impact of keeping the market at that level. The SPX can get pinned to near that level due to sort of options effects which we don't need to fully understand to make sense of this.

Speaker 1: 13:17

But essentially what we're saying is that 5565, it's a very, very, very good support level and that's exactly what I'm trying to get across to you here. So maybe just write down 5565 as a good support level, so you have that key data here. And then I shouldn't be showing you this either, because again people will say to me Felix, you need to keep it simple, you need to keep it really simple so that everybody fully understands this. And I'm saying well, what would be the point of that? What if I wasn't challenging you? What if I was showing you only what CNBC is telling you? Then there would be zero value to these videos. And my intention is to give you real, unadulterated education. So this chart, let's make it simple.

Speaker 1: 14:00

Essentially, what this is showing us that put options are very expensive. That's what it's saying to us. So what are put options? Put options and guys, stop with the options, felix. Just see put options as um, as insurance or as a bet, bet on a crash, basically right, that's what they are. So you're hoping the market's going to go down now, when they're really expensive, and they are really expensive right now. What does that mean? Well, people are going to start selling them. Why I sold some put options yesterday that I had previously bought and now I sold them because they made us a lot of money. So what happens when you sell them? What happens to the market? Drives the market up. It's supported. People have made enough money. They're going to start to close these. It's going to be supporting the market as people take profits. That's again something that you're not going to see anywhere else, because it's a little complex and there's a whole train of thought that runs through that, and if you want to learn more about that, well, we'll be super happy to teach you, but it's going to take a little bit of time and I want to keep it simple here. Now this is a bit more simple.

Speaker 1: 15:11

Inflation isn't what you're told it is. The government tells you inflation is two and a half percent or something like. That's what the government says, something like that 2.5 percent, and that's nonsense, because it's actually 1.3 percent and it's collapsed massively. So why all the inflation fears? Because the government lies about inflation data. They always do. Um, the us inflation data that government puts out is massively adjusted seasonally, this, seasonally, that, basically to make it look like whatever they want. And at the moment, for some reason, they want to pretend that it's higher.

Speaker 1: 15:44

If inflation was at 1.3%, what do you think the Fed would be doing? Would they be raising interest rates or cutting interest rates, higher rates or lower rates? What do you think? Well, why do you have high rates? Because you're worried about inflation. So why wouldn't you cut rates if inflation was at 1.3%, which is below the target? Right, the target's 2%? So are they going to cut rates? Well, guess what?

Speaker 1: 16:12

Wall Street knows something. Wall Street trades. This is weird. Wall Street trades the expectations on when the Fed will cut interest rates. Yeah, you can trade everything. It's like horse racing or something. And right now, this is now.

Speaker 1: 16:32

So right now is where interest rates are, so this is one cut. This is now so right now is where interest rates are, so this is one cut, this is two cuts, and this is for the June meeting. So we're going to get one to two cuts for the June meeting, says Wall Street. Or what if we zoomed out till the end of the year? This is now, this is where we are. Right now, nobody thinks rates are going to be at the current level. This is one cut, this is two cuts. This is three cuts. This is four cuts. This is five cuts. Some people even think there could be six cuts. So the majority of the market is now leaning to three to five cuts in interest rates, which means we might have interest rates of 3% of the end of the end of the year, not the 4.25 that we have right now.

Speaker 1: 17:17

What would that mean? Well, what do lower interest rates do to stocks? Well, say, you have a portfolio that consists entirely of this sort of you know, ark kind of crazy stocks not crazy, but you know, high-risk stocks. Well, if interest rates go down by, say, just 1% four cuts right by 1%, down by, say, just 1%, four cuts right by 1% Rates go down 1%, then what happens to stock prices? Well, those kind of high growth stocks you'd expect them to go up by about 9%. That would be the rational thing to do. Now, market isn't rational, so it might well exacerbate and exaggerate that move. So it could be somewhat more than that. And this is a huge, huge, huge shift in where we were. Just two weeks ago, we were expecting very few cuts, like two or something. So that's a big shift and that's a good shift for the stock market. So why hasn't the stock market moved yet? Well, just fear, right. The market in the short term is driven by fear and emotion.

Speaker 1: 18:12

So is that helpful? I so. Is that helpful? I hope that's helpful. If it is, write helpful in the chat and maybe again take a screenshot of this so you have that data and maybe explain it to somebody else. That's always the best way to learn. This is really really key, key data.

Speaker 1: 18:23

Now, how do you apply it? What do you buy with it? Well, rather than me running you through what I think you should buy right now, I think it's better that I give you the rules and the fishing rod rather than the fish. Don't you think so? If you want to learn everything that I've been taught by very smart people and everything that I've learned over the last 13 years or so probably learned less than I was taught. That's usually the way, isn't it? Go and watch my 15 minute masterclass, which will literally teach you those very rules of like what do we buy now? Literally, what stocks do we buy now? And then, for the next time the market dips, where do you set up your exits? Because there will be another dip, the bigger than this one. So how do you get access? Felixpenceorg slash, get free. It's completely free of charge. You can watch it as many times as you like Bonus chart and then I'll tell you what I'm buying today. Okay, we've managed to run through quite a lot today, haven't we so more crazy charts that nobody else shows you? Yeah, that's exactly what this is all about.

Speaker 1: 19:26

These are algo funds that are computer driven and they've sold a massive amount of shares. They've sold about $60 billion billion, with a B of the s&p from basically mid-february here to where we are right now. Right, 60 billion dollars they sold. What does that mean? The algo funds are finding themselves in an unusual position where they are now short the market. They they're oversold. So what happens is that they're going to be buying, no matter what, and even if the market stays flat. So a flat market, which means stocks are just staying where they are the algo funds will buy $40 billion American dollars off the S&P, which is pretty tremendous. American dollars off the S&P, which is pretty tremendous. So that in itself is a little spark that could drive the market significantly higher. And if you think about how everybody else is probably short too, and everybody else has put options that are essentially shorting, they will close. All of those guys will get squeezed up when the market rebounds.

Speaker 1: 20:34

Do I think the market will rebound? I do. Do I think the market will rebound? I do. Do I know exactly when? No, of course I don't. But I know that, from my perspective, the risk reward right now is pretty good if I have a long-term horizon and by long-term horizon I mean years, not months.

Speaker 1: 20:51

So what am I buying? Well, I'm buying the simplest and the easiest thing that I can buy right now, with our lowest risk. So that's always what I look for. I always look for the lowest risk trade with the highest profit potential. But low risk is always the key, because that's how we preserve our capital, that's how we preserve our money, that's how we sleep all night.

Speaker 1: 21:16

What am I buying? Very simple, I'm basically buying the S&P. I'm buying SPY or some variation of that ETF. You could also buy the QQQ. It'd be a little bit more volatile, but it's sort of the same thing. And so why am I buying the index? Because the index, in the long run, will always go up, will always go up. It's just the law of gravity. Essentially, money will be printed and therefore it'll always go up. Companies will get more profitable and therefore the S&P will go up and the QQQ will also go up, although it's a bit more volatile, as I say. So why am I not buying? You know, I don't know Palantir or you know anything else so far, or something Because all of those stocks at the moment are quite risky, and if you watch the masterclass you would understand exactly why I'm saying that they're risky and why our probabilities there are not looking that great right now.

Speaker 1: 22:02

It doesn't mean they're bad companies. It doesn't mean long-term I'm bearish on them at all. What I'm saying is that at this particular moment, when we have these dips, the best thing is just to buy broad stuff. So buy an index, a big juicy index, and that way we are very, very likely to benefit from the rebound that we're going to get. Which is how I started this video right, I showed you that we go up after 10% drop. You know, the next year we go up typically 10%, 20%, 30%, 40%, 50%. You know, maybe not 50%, it might be a little exaggerated, but yeah, you know we typically go up significantly.

Speaker 1: 22:39

So I want to make sure I grab that bull by the horns and take advantage of that. So if all of those pieces of information and I appreciate it's been a little information dense here today were useful for you, then I'm very happy. But what would make me much, much happier is if you now take all that information overload and say, okay, this makes some sense, maybe even makes complete sense, doesn't have to. And what I really want to do here now is I'm motivated to make sure that the next rally, when it comes because it'll come I'm not going to be like it, get left behind, because I know exactly when I'm buying and exactly how I'm setting that up. I know exactly how I'm automating. I know exactly how I'm setting that up. I know exactly how I'm automating that. I know how I'm screening through thousands of stocks without having to lift a finger.

Speaker 1: 23:20

And all of that good stuff is in the masterclass that I made for you. Felixfrenzorg slash, get free, because our mission here is to make a million people financially free, and we won't achieve that if people are seesawing along with a market right. We need to do better than that and I believe that we all can. So go watch the masterclass, my friends FelixWenzelorg, get free and make yourself smarter, make yourself better equipped, get better tools so you too can spot the patterns and wake up with a smile on your face. All the best.