I hope you enjoyed a Thanksgiving feast for the ages yesterday.

Today, instead of reading a big Rude, I present you a video with my friends and colleagues, Paradigm’s Fearless Leader, Matt Insley, and Greg Guenthner, Daily Reckoning contributor and Head of Paradigm’s The Trading Desk.

Click the pic or here to watch the video.

Here’s a choice quote from their talk:

I know the news has been crazy this year, but we had that mini-banking crisis back in the spring that sort of put things on pause. But as you can see here, and this is the NASDAQ 100, these are the biggest tech stocks in the world right here. The market absolutely ripped higher into the summertime, and then we topped out where the market should have been topping out in July. And when I say that I'm talking about seasonality. This is a pre-election year. Generally in a pre-election year, you tend to see markets move higher during Q1 and Q2 and then level off in the summer. 

They tend to go down in the early fall and then snap back and close at the highs in November/December with a big end-of-year meltup. It doesn't always happen that way, but seasonality is very useful if you look at these patterns and you say, Hey, where could the market possibly be going and use that kind of as a roadmap. And when we have a year like this year that's followed seasonality so perfectly, it's been much easier to gauge where these potential turning points could be. But again, a big rally to start 2023 topped out in July. And then August/September things got a little bit wonky, and then all the bears came out of hibernation in October.

Here’s another one:

Everybody's been so focused on the NVIDIAs. I mean look at this, when stocks were correcting pretty hard back in October, Nvidia really wasn't doing that much. It was still in this nice consolidation range that we see right here and we see the surge here from earlier this year. I mean at the start of the year it was $140 and we know what's happened since then. Nvidia sucked all the air out of that AI bubble and took all of those investors and everybody wanted to be in Nvidia. 

This is the one stock that everybody's had to own. They've had to own it all year long and they hid out in it when the market got wonky here in August, September, and October, and now it's pushing again into new highs. I mean it's been an incredible performer, but if you're thinking tactically and you're thinking what's going to be the next thing that moves the next great trade on the market, I don't think it's going to be in Nvidia. I don't think it's going to be Apple. I don't think it's going to be Meta. I think it's going to be the smaller stocks. I think it's going to be the tech survivors, the stocks that got smashed in 2022 and had trouble getting off the mat after the summer rally here in 2023. I think it's going to be those stocks, the ones that survived this period right here and have gotten beaten down, the stocks that are down 60, 70, 80% from those highs. 

On Crypto:

Crypto winter was a big thing and the question throughout the end of 2022 and early 2023, I had, was enough of that speculative money completely burned out of the crypto space to give this thing a shot at setting back up again. On the long side, a lot of people may not have noticed this, but right here, this big move in Bitcoin from $27k all the way up to $37k is a $10,000 move in Bitcoin almost that happened before stocks bottomed out in October. We had crypto traders pushing Bitcoin higher in the face of what looked like a breakdown in the stock market. Something like that really gets my attention because it doesn't add up. Your average crypto trader or investor, whatever you want to call them, is a speculator, and usually, the Bitcoin trade and the tech growth trade hold hands, they kind of do the same thing, maybe not in orders of magnitude, but they tend to directionally go the same way because it's the same type of trader. 

Wrap Up

I encourage you to take some time today to listen to Greg’s market analysis. Few people do it better than he does.

Have a lovely weekend!