Tuesday Market Close (Nov 18, 2025)

Key Concepts

• Market Analysis: Discussion of Bitcoin, Gold, S&P 500, NASDAQ, Dow Jones, Russell 2000, Bonds, Oil, and VIX.
• Technical Analysis: Support and resistance levels, volume gaps, descending/symmetrical triangles, wedges, bull flags, continuation patterns.
• Economic Indicators: Fear index, GDP, employment outlook, inflation, quantitative easing (QE), quantitative tightening (QT).
• Investment Strategies: Long-term bullish/agnostic views, shorting, options trading (straddles, calls, puts), covered calls, protective puts, dollar-cost averaging, spin-offs, commodities, mining stocks, rare earth stocks, Bitcoin allocation.
• Company Analysis: Amazon, Unity Electronics, Nvidia, Home Depot, Franco Nevada, SanDisk, Beyond Meat, Caterpillar, STRC (Strategy).
• Financial Concepts: Carry trade, round-tripping, AI in business, syndicated conservation easements, real estate professional status, short-term rental loophole, money market levels, cash levels, debt transactions, money supply, store of wealth vs. money.
• Market Psychology: Extreme fear at bottoms, bull markets climbing a wall of worry.

Market Overview and Technical Analysis

The speaker begins by reviewing current market conditions.

• Bitcoin: Is currently holding above the 92,000 support level, which is considered strong support from early 2025. However, it has tested below this level, and the speaker expresses some concern about its holding. The next significant support level, if 92,000 fails, is identified as a range between 72,000 and 74,000, noting a volume gap in this area.
• Gold: Is holding above 4,000, which previously acted as resistance. A potentially descending or symmetrical triangle is forming, and the speaker anticipates continued volatility after a significant run-up. The speaker believes that gold has already priced in the expected monetary easing over the next year and does not anticipate massive further upside, suggesting a period of sideways action is possible.
• Overall Markets: Are experiencing downward pressure. The fear index is at a record high since April, which the speaker notes is unusual near all-time highs and typically indicates volatility rather than market tops, as extreme fear is usually seen at market bottoms. The Dow and Russell 2000 are also mentioned as being closer to their tops percentage-wise.
• Bonds and Oil: Are moving sideways with no significant developments.
• VIX: Is elevated due to market fear.

Investment Strategies and Company Discussions

The discussion then shifts to specific investment strategies and company analyses.

• Amazon: The speaker is extremely bullish long-term but agnostic short-term.
• YouTube Issues: The speaker notes that other content creators, like Uneducated Economist and Lynette Zang, have experienced issues with YouTube, humorously noting it's good that the problem isn't with his own content.
• Japanese Government Bonds (JGB) Yield and Carry Trade: The speaker states that the rising JGB yield will not cause a disorderly unwind of the carry trade because market participants have been anticipating these moves for years. Unlike past unexpected defaults or tightening measures, there have been no macro-level surprises.
• Spin-offs (Unity Electronics/DuPont): The speaker recommends Joel Greenblatt's book "You Can Be a Stock Market Genius" for understanding spin-offs. The general thesis is that spin-offs often experience initial selling pressure due to institutional investor rules and rebalancing needs, regardless of intrinsic value. However, after this initial sell-off (typically a few months), they often perform well long-term due to more aligned management incentives and tighter feedback loops.
• Nvidia: The speaker is neutral on Nvidia due to an upcoming earnings report. They explain that the cost of at-the-money straddles can indicate expected volatility but not direction. The speaker found options for an earnings play to be too expensive relative to potential moves, leading to a lack of conviction for a directional bet.
• Nvidia's Revenue Concerns: Regarding allegations of "fake revenue" through loans to companies to buy Nvidia chips, the speaker lacks a strong opinion due to insufficient deep dive. While it seems adjacent to fraudulent accounting, the widespread demand for chips across the market suggests the underlying demand is real. The speaker has no current position in Nvidia.
• BTQ (Technology Services Package Software): The speaker is unfamiliar with BTQ, which is reportedly up 32% and engaged in "postquantum encryption" and blockchain, terms the speaker views as potential buzzwords.
• Recession and Employment Outlook: The speaker defines recession by two consecutive quarters of GDP decline, which occurred in 2022. They suggest we could be in one now, citing Home Depot's earnings drop (though attributed to fewer storms impacting roofing suppliers, not a collapse in demand).
• Mining Stocks: The speaker is generally bullish on commodities, including gold miners. However, they find picking individual mining stocks difficult and prefer index funds like GDX or large companies like Barrick and Franco Nevada (FNV). The speaker is hosting a webinar on Sunday about a commodity trading strategy combining technical analysis.
• SanDisk: The speaker is long SanDisk and considers it a well-run company that was recently spun off from Western Digital. They note a significant initial drop post-spin-off but positive performance since. A bull flag pattern is observed, suggesting potential continuation of the prior upward move.
• Beyond Meat: The speaker expresses a fundamental dislike for the product, viewing the attempt to recreate animal protein in a lab as "doomed to failure." They advise against investing based on emotional reasons and suggest asking if one would buy the stock today with cash if they had the current position's value.
• AI in Business: The speaker does not use AI for YouTube scripts or research, finding it difficult to replicate individual personality and brand. They have tried using AI for outlines and research with limited success. AI is seen as more useful for editing and graphics, which their team handles.
• Bitcoin Miners vs. Commodities: The speaker clarifies that when discussing commodities, they refer to physical inputs for the real world, not Bitcoin miners or crypto, which are software/programs. They mention IREN as a company transitioning from Bitcoin mining to data centers, which they had previously alerted members about.
• Gold Props: The speaker clarifies that the gold items in the background are props from Amazon, not actual gold, due to safety and cost concerns.

Trading and Risk Management

The speaker details their decision-making process for trading and managing risk.

• Long vs. Options: The decision to go long or use options depends on whether options are available. The speaker rarely shorts stocks due to undefined risk. If bearish and no options exist, they avoid the trade. If options are available, they consider puts.
• Options vs. Shares: When deciding between shares and options, the time frame is crucial. Long-term holdings with no specific catalyst are typically equity positions. Options are generally used for shorter time frames with specific catalysts (earnings, buyouts, etc.).
• Risk Management with Options: Options can offer better risk management by allowing smaller position sizes. The speaker illustrates this by comparing a $10,000 stock investment with a potential 1% portfolio loss to using $1,000 for an in-the-money option, limiting the maximum loss to 1% of the portfolio while still allowing for leveraged gains.
• Covered Calls and Protective Puts: For a covered call strategy with protective puts, the speaker advises buying longer-dated puts (e.g., a year out) and selling shorter-dated calls (e.g., 30 days out) to maximize premium collection and time decay benefits. Strike prices for calls should ideally be outside the stock's average true range (ATR) to reduce the likelihood of being called away due to natural volatility. The strategy should be managed dynamically, not on a fixed schedule.
• SanDisk Sentiment: The speaker acknowledges a contrarian view on SanDisk, noting that significant upward moves often face skepticism from those who missed out.
• Caterpillar and Rare Earth Stocks: The speaker is bullish on Caterpillar as a long-term holding. They are generally positive on rare earth stocks due to trade wars and deglobalization, provided they are legitimate operations.
• Bitcoin Allocation: The speaker has a 5% long-term allocation to Bitcoin, initiated in October 2020 at $10,000. This is considered an asymmetric bet: if Bitcoin becomes money, its value could multiply significantly; if not, the loss is limited to 5%. This allocation is maintained for new investments through dollar-cost averaging.
• Live Meetups: The speaker has not held in-person meetups for several years due to a negative ROI and past associations with events that later faced scandals. They would consider large, reputable conferences if invited.

Economic and Monetary Policy Discussions

The conversation touches upon broader economic and monetary policy topics.

• Dollar Reset and Stocks: In a dollar reset scenario, most stocks would perform well as their dollar price would increase with the dollar's declining purchasing power. Exceptions would be stocks heavily reliant on dollar-denominated assets like treasuries or cash equivalents.
• Fed Policy and Economic Crisis: The speaker does not believe an economic crisis is imminent solely based on the Fed not cutting rates, as slight rate cuts are largely priced in and have not significantly impacted the yield curve thus far.
• Quantitative Tightening (QT) Ending: QT is ending on December 1st, meaning the Fed's balance sheet will stabilize. They will reinvest maturing assets, preventing further net liquidity withdrawal. However, the Fed will shift the composition of its balance sheet by selling mortgage-backed securities and buying more T-bills, which is expected to have a QE-like effect by keeping short-term rates down and facilitating government borrowing. A restart of actual QE is dependent on future liquidity issues.
• Cash Levels and Money Supply: The speaker disputes the notion of universally low cash levels, pointing to near all-time high money market levels. They explain that non-debt transactions merely move cash within the system, while only debt transactions create or destroy cash, thus altering the money supply.
• $2,000 Checks and Inflation: The speaker doubts the likelihood of direct $2,000 checks being issued, suggesting alternative forms like tax credits or deductions are more probable. They anticipate price increases if such measures are implemented.
• Retail vs. Institutional Trades: Information on whether a trade was retail or institutional is available to some extent through large block trades, insider filings, and observing institutional trading patterns (VWAP, TWAP). Level 2 data shows potential orders but not past executed trades.
• Syndicated Conservation Easements: The speaker avoids investment decisions based primarily on tax benefits, citing past negative experiences where prioritizing tax advantages led to lower overall ROI. They recount a personal experience with a short-term rental property where tax savings were outweighed by the investment cost and effort.
• STRC (Strategy) Investment: The speaker advises against investing in STRC, describing its model as "Ponzi adjacent" because it raises new money to pay dividends and service debt, without generating income or cash flow from its business activities. The payouts are reliant on speculation of asset appreciation and new investor funds.

Conclusion

The market closed with Bitcoin holding above 92,000 and gold above 4,000. The S&P 500 and NASDAQ closed down, but with significant wicks on the bottom of the candles, indicating some bullish action and preventing a purely bearish close. The speaker concludes that while not entirely out of the woods, the situation is not "terribly bearish." The speaker thanks the audience for their questions and promotes an upcoming webinar on commodities.