Ho-Ho-Ho … Happy Holidays: To bring a smile to your face, here’s a little game that MCC pointed out to me: ‘Carrot in a Box’. It’s a bluffing exercise – enjoy: https://youtu.be/0UGuPvrsG3E and https://youtu.be/Bp04HZDCELw.
Choose your next job carefully: One type of job will require you to stick to a recipe. Another, will require you to understand the recipe. If you understand it, then you can change it. Your ability to understand increases your resilience, insight, and leverage. Which job is better for you?
The Business Plan tells you one way that the business will NOT grow:
- Your Demand: If you decide to become a coach, most of your prospects will be people who don’t think they need a coach. (Because the people who needed a coach – already have one.)
- Your Surroundings: If you’re a mental health professional, most of the people you encounter will have issues with their mental health.
- Your Competitive Advantage: If you attract new business by being the cheapest, your customers will always want a lower price.
Choose your path wisely because – most-of-the-time, things workout the way they are supposed to – not as we might like at the time.
The Market:
My equity markets New Year’s List:
1. Continued high volatility,
2. Make more meme-stocks,
3. Gimme crypto options and lotsa IPO’s, and
4. Continued price movement outside of the expected move.
Bank predictions for 2022:
1. Goldman expects things to stay bullish. GS is not fazed by Omicron, but is concerned about the Democrats’ failure to pass Build Back Better.
2. B of A believes that the stock market will trade flat next year.
3. Morgan Stanley expects next year to come in with a small loss.
4. Wells Fargo thinks that “the probability of a correction is rising” (duh).
Pantera Capital’s top crypto predictions:
1. Level2 Scalability: Scalability platforms built on Ethereum will gather traction because a solution is needed for Ethereum’s increasing network congestion.
2. Non-Eth/Bitcoin Chains: Decentralized application (dapp) ecosystems will continue to grow as bridges – in order to increase cross-chain liquidity.
3. Web 3: Projects will find new ways to integrate with one another in order to create a unified user experience.
4. NFTs: NFTs will continue to soar in popularity as the digital artform grows. NFTs will also begin to power verticals like: music, gaming, and influencer fanbases.
5. DAOs: More decentralized autonomous organizations will launch around unique / fascinating use cases – but management of the DAO will be the issue.
6. DeFi Security: DeFi security will be a higher priority in order to increase users’ confidence and trust in DeFi as a viable, financial alternative.
InfoBits:
- The U.S. money supply increased 40% over the past 2 years. It was the largest increase … EVER.
- In 2021, SPACs and IPOs raised 800% more money than in 2019. In 2019, SPACs and IPOs raised $19B – in 2021 they raised $159B.
- Oracle bought medical-records company Cerner… for $28.3B. The all-cash deal makes Oracle the latest cloud player to break into healthcare.
- The opening weekend for “Spider-Man: No Way Home”… was the third-most successful opening weekend for a movie in the U.S.
- Build Back Busted is the Dem’s nightmare before Christmas. The $1T infrastructure bill that included monies to modernize roads, bridges, and transit is still happening. But Dems saw it as an appetizer to their larger plan.
- Elon Musk finished selling stock to pay his +$11B tax bill… after Sen. Elizabeth Warren accused him of tax evasion. Tesla stock immediately rose 7.5%.
- Due to COVID, global economic growth has slowed to a crawl. Not to mention, our FED’s’ inflation measure is up 5% this quarter.
- U.S. population growth fell to a record low... of 0.1% growth YoY.
- Abbott and Quest Diagnostics are happy that… Pres. Biden plans to distribute 500m free at-home COVID tests starting next month.
- Nikola agreed to pay a $125m fine… to settle fraud charges surrounding its technology readiness (the infamous truck-rolling-down-hill promo).
- Pfizer’s Covid-19 pill (Paxlovid) just received FDA clearance… and Pres. Biden just bought 10m treatments for $5B.
- The Biden Administration extended the student loan payment pause… until May 1, 2022.
- Two-thirds of companies, including Apple, Ford, and Google… have postponed office returns.
- The World Economic Forum has been postponed… but next month’s CES (Consumer Electronics Show) in Vegas is still on.
- Companies bought back a record $850B worth of stock this year.
- Over 20% of people have gone back to their pre-pandemic lives. The virus will never fully go away, but people’s ability to live restrained lives absolutely will.
- Consumer Confidence rose last month… suggesting the public is feeling bullish about the economy, despite inflation and supply chain woes.
Crypto-Bytes:
- You can now buy Bitcoin in Walmart. Bitcoin ATMs are already in 200 stores, and will expand to 8,000 in the coming months. Bitcoin has more than doubled in value this year, and we’re opening it up to WMT’s’ +220m weekly customers.
- JPM has partnered with Siemens… to develop a semi-distributed system for payments using the bank’s Onyx blockchain.
- The Bank of England is facing informational challenges… as it tries to ramp up the pace of regulating crypto. It seems that the number of banks offering crypto trading and custody for clients is growing exponentially.
- MicroStrategy (MSTR) outlined various ways… it could generate yield from its 122,478 bitcoin stockpile during its investor day. It could do counter-party lending of BTC, put a lien on it for other software firms, or even mortgage it out.
- Fitch Ratings thinks that regulatory clarity… could moderate stablecoin credit risks. That would create new market opportunities, and reduce the uncertainty that has deterred financial institutions from using them.
- Deutsche Telekom AG, put its weight behind Polkadot… by purchasing a significant amount of DOT, and will also provide node-running infrastructure for other stakers.
- El Salvador bought another 21 Bitcoin… to mark the 21st day of the last month of the 21st year of the 21st century. They now hold 1,141 BTC and plan to buy $500m more with a $1B bond tokenized on the Liquid network sidechain.
- For $23m, Adidas sold out of all 30K of its new "Into the Metaverse" NFTs. Each NFT costs about $800 and included physical merch like tracksuits, wearables, and invites.
- Block CEO Jack Dorsey has gone on a frenzy… suggesting venture capitalists like Andreessen Horowitz’s (a16z) Marc Andreessen, Coinbase’s Brian Armstrong, and Gemini’s Tyler Winklevoss need to put Web3 power back in the hands of regular web users.
- A law to regulate cryptocurrencies in India… is unlikely until at least after a Budget Session in April, 2022.
- Swift, the cross-border payments service used by over 11,000 corps…. is planning to experiment with tokenized assets in Q1 2022.
Last Week:
Monday: The market is very grumpy this morning. Over the weekend, we learned that (a) Goldman cut its GDP forecast after Sen. Manchin said that he wouldn’t support Biden's 'Build Back Better' plan, (b) the world is going back to lockdowns over the Omicron variant, and (c) our FED has threatened to remove some punch from the bowl – and the market is reacting like little kids who were told they can't have any more candy. This time we need to entertain the idea that ‘it’s different’ and maybe the run is over. I've said for years that the plan is for the Powers-that-Be to support the markets UNTIL they decide they want to inflict maximum pain, and at that point they will pull the plug. Is this the day? I don’t think so. In fact, I would actually entertain the idea of buying NVDA over $280.80 and AMD over $137.54.
Tuesday: The futures are up wildly this morning. Did we cure cancer? Did we end the pandemic? No, this is a reflex bounce after seeing the DOW lose almost 2K points in 3 days. The only question is whether it will hold. It could be the start of the Santa rally, or it could be a couple and done. I’m watching: KLAC, C, and STX over $107.50. The $107.50 level on STX is like a brick wall, but if it gets past it – it could soar.
Wednesday: It seems like the chip sector could stay hot, with AMAT, LRCX, heck even MRVL waking up. Watch ‘em today.
TW3 (That Was - The Week - That Was):
Crypto is fine … wish you were here. The total crypto market cap has more than doubled in the past 2 years. We’re seeing higher highs in recent weeks than what we saw earlier this year. I don’t feel bad at all about where we are in crypto-land.
Ethereum is slow, expensive and… it will be months until its developers start to arrest that problem. That’s why new “scaling blockchains” are getting some love. Solana and Cardano are no strangers to the spot-light, but unexpectedly Avalanche received a big vote of confidence from a B of A analyst and rose 32% in response.
Bitcoin has had a great year. The digital currency is up +70% since the start of 2021, driving the entire crypto market over $2T. In 2021 we saw: (a) the 1st major crypto go public with the debut of Coinbase in April, (b) increased participation from Wall Street banks like Goldman Sachs, and (c) the approval of the 1st U.S. ETF linked to Bitcoin. Here are a couple more predictions from crypto-experts for 2022:
1. Watch for a crypto-crash in the coming months,
2. We should have our 1st spot Bitcoin ETF,
3. Financial institutions will continue to rotate into ‘DeFi’, and
4. Crypto-regulations will begin to pop-up everywhere – including the U.S.
Next Week: The Strong continue to get Stronger…
EOY Update: What worked, What didn’t work, and the Trends going forward.
- Indices (YTD): IWM +15%, DIA + 19%, S&P +28%, and QQQ +28%.
- AMZN +7%, FB +25%, AAPL +36%, TSLA +46%, MSFT +50%, GOOGL +70%, and NVDA +126%.
- Crude Oil +55%, Gold -7%, and TLT (Bonds) -6% year-to-date.
- XLP +13%, XLU +14%, XLI +20%, XLB +23%, XLV +23%, XLY +27%, XLF +33%, XLK +35%, XLE +45%
- Going into 2022, the S&P, Nasdaq, and DOW could finish at all-time-highs despite any and all short-term gyrations.
A Simple STRATEGY for a COMPLEX time:
TIP #1: If it’s STRONG right now (attracting money-flow) – then it will be STRONGER moving forward (attracting more money-flow).
- These stocks provide opportunities to buy on pullbacks & retracements back to their 20-day exponential moving average (EMA).
- You then sell covered-calls against them (on a monthly or bi-monthly basis) – fully expecting them to maintain their strong, previous performance.
- Review the performance of: United Health (UNH), Broadcom (AVGO), and McDonald’s (MCD), and Apple (AAPL).
- You’re looking for stocks where:
o Their ‘close’ is greater than their 20-period EMA, and
o Their ’20-period-moving-average’ is greater than their 50-period EMA, and
o Their ’50-period-moving-average’ is greater than their 200-period EMA.
- You buy them when they pull back into their 20-period EMA.
- Examples of this strategy would be:
o Apple (AAPL), United Healthcare (UNH), McDonalds (MCD), and recently Microsoft (MSFT),
- You would prefer stocks that are gradually up-trending and NOT experience deep pullback events.
- Look at UNH, PG, and PFE on pullbacks to their 20-day EMA.
TIP #2: If it’s WEAK right now (not attracting money-flow) – then it will be WEAKER moving forward (not attracting any more money-flow).
- You’re looking for stocks where:
o Their ‘close’ is less than their 20-period EMA, and
o Their ’20-period-moving-average’ is less than their 50-period EMA, and
o Their ’50-period-moving-average’ is less than their 200-period EMA.
- You short / buy Put spreads when they pull back into their 20-period EMA.
- I put my most recent SHORT list below.
Tips:
HODL’s: (Hold On for Dear Life)
- *BitFarm (BITF = $5.75 / in at $5.12)
o Sold Feb, May, Dec ‘22: $5, $7.50 & $10 CCs for income,
- **Bitcoin (BTC = $51,100 / in at $4,310)
- Energy Fuels (UUUU = $7.95 / in at $11.29),
o Sold Apr $11 CCs for income,
- **Ethereum (ETH = $4,100 / in at $310)
- GME – Holding
- **Grayscale Ethereum (ETHE = $38.08 / in @ $13.44)
- **Grayscale Bitcoin Trust (GBTC = $39.13 / in @ $9.41)
- Hyliion (HYLN = $6.64 / in @ $6.01)
o Sold Jan, Feb $6 and $7 CCs for income,
- **Loopring (LRC = $2.31 / in at $2.27)
- **Solana (SOL = $193 / in @ $141)
- Uranium Royalty (UROY = $3.82 / in at $4.41)
o Sold Jan $5 Calls for income,
** Denotes a crypto-relationship
Thoughts:
Follow me on StockTwits.com to get my daily thoughts and trades – my handle is: taylorpamm.
Please be safe out there!
Disclaimer:
Expressed thoughts proffered within the BARRONS REPORT, a Private and free weekly economic newsletter, are those of noted entrepreneur, professor and author, R.F. Culbertson, contributing sources and those he interviews. You can learn more and get your subscription by visiting: <http://rfcfinancialnews.blogspot.com/>.
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