Charts Point to More Pain for Apple & Tesla — Transcript

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1. 0:07[Applause]
2. 0:08[Music]
3. 0:08[Applause]
4. 0:15[Music]
5. 0:15[Applause]
6. 0:17[Music]
7. 0:19all right
8. 0:22heavy riff here on a Monday it is Monday
9. 0:24it is November 7th guyadami here Dan
10. 0:27Nathan there in just a few minutes and I
11. 0:29promise you it will be just a few
12. 0:32minutes Carter worth of worth charting
13. 0:34will be joining us today we're sponsored
14. 0:36by factset financial data and analytics
15. 0:39powered by tomorrow this is Market call
16. 0:41but before we start Dan we just had a
17. 0:44fascinating conversation with nuriel
18. 0:46rabini that's going to drop later in
19. 0:48your favorite podcast store part of the
20. 0:51on the tape presentation and I got to
21. 0:53tell you something if I wasn't terrified
22. 0:55prior I'm certainly terrified now yeah
23. 0:58well you know his new book that's out
24. 1:00it's called Mega threats and he's
25. 1:02talking about a whole host of things
26. 1:03that we talk about on a daily basis just
27. 1:06kind of things that are impacting the
28. 1:07economy markets that sort of stuff he's
29. 1:09thinking about things like debt and
30. 1:12leverage and and Central Bank
31. 1:14intervention and climate change and
32. 1:16geopolitical risks like war and stuff
33. 1:18like all this stuff he's talking about
34. 1:20them all converging for a whole host the
35. 1:22reasons in the book I've been reading it
36. 1:24it is fascinating you definitely need to
37. 1:26kind of take a step back every once in a
38. 1:28while because it's it is meant to have
39. 1:31an optimistic thread through it guy but
40. 1:33the themes are actually kind of scary
41. 1:36and we do see a lot of these things play
42. 1:38out in our daily lives as we think about
43. 1:40markets in the economy too yeah and in
44. 1:43speaking to him it's he just galvanized
45. 1:46a lot of things that I know I've thought
46. 1:47I'm sure you have as well and the fact
47. 1:49that these things are not siled they're
48. 1:51all somehow interconnected but he also
49. 1:53said to your point about ending on a
50. 1:55cheery note there's still time to sort
51. 1:57of eradicate and get ourselves out of
52. 2:00the mess that we've basically created
53. 2:02for ourselves so listen to that it's I
54. 2:05think it's going to drop within the next
55. 2:06hour hour and a half I know I'll listen
56. 2:09to it and again at your favorite podcast
57. 2:10store I just like saying that because
58. 2:12it's so dumb anyway how are you Dan I'm
59. 2:15doing okay here guy I mean you know it's
60. 2:17It's Kind of a Funny Day in the market
61. 2:18you know there were two headlines
62. 2:20overnight that of course get me all kind
63. 2:23of excited here the first was that you
64. 2:25know this meta the stock was trading 130
65. 2:27okay before it reported earnings um it
66. 2:30was trading what uh you know close to
67. 2:32300 or above 300
68. 2:34um you know a year ago before they
69. 2:36changed their name to meta and the
70. 2:38announcement was that they're gonna
71. 2:39start some heavy layoffs here and again
72. 2:41what are investors not happy about costs
73. 2:44specifically costs focused on building
74. 2:46whatever they think the metaverse is but
75. 2:49they're reducing headcount a lot of
76. 2:50their Mega cap peers are the stocks up
77. 2:52five percent after being down 30 percent
78. 2:54in in a month or so and then the other
79. 2:56one was Apple and you know Apple again
80. 2:58and you and I were talking about this
81. 3:00you said this very clearly after that
82. 3:02report we're gonna look at the charts
83. 3:04with Carter in a few minutes here but
84. 3:06this is one where the stock gapped up
85. 3:08after their results it sounded like
86. 3:10China wasn't as bad as some feared and
87. 3:13then they come out with a cut on iPhone
88. 3:15production because of China two dueling
89. 3:18Mega cap tech stocks with different news
90. 3:20yeah you know and the comparison person
91. 3:22that I made is if you go a couple
92. 3:24quarters back and look at the quarter
93. 3:26that Microsoft reported stock was
94. 3:28trading around 255 or so the knee-jerk
95. 3:31reaction to the quarter was to take the
96. 3:32stock lower yeah and then subsequently
97. 3:35when we heard their uh they're basically
98. 3:38some of the comments they made about not
99. 3:39seeing demand destruction the stock
100. 3:41rallied and subsequently the broader
101. 3:43Market rallied Microsoft traded up to I
102. 3:45think 300 and then obviously it gave the
103. 3:47entire thing back and the comparison
104. 3:49that I made was listen the Apple quarter
105. 3:51was fine the guidance was not great and
106. 3:54the knee-jerk reaction on the Apple
107. 3:56quarter was to take it down from 144
108. 3:58down about 138 subsequently though that
109. 4:02was the same day that Amazon reported I
110. 4:04think there was this flight to Quality
111. 4:06Apple traded up to 158 I said it didn't
112. 4:08make a lot of sense it should actually
113. 4:10trade back down to the levels that we
114. 4:11saw in lo and behold here we are so
115. 4:13again I happen to think this is a good
116. 4:15thing this is something that Carter
117. 4:16talks about all the time I do think
118. 4:18there's further room to the downside I
119. 4:20think the only thing is keep an apple uh
120. 4:22up today is the fact that the broader
121. 4:24Market seems to want to hold in so we'll
122. 4:26see again as I like to say how things
123. 4:27shake out yeah there's and there's some
124. 4:30stuff going on I mean when you say it's
125. 4:32a good thing that Apple you know again I
126. 4:33think you've been saying 125 120
127. 4:36um you know gets you back to let's say
128. 4:38maybe a 30-some percent Peak to drop
129. 4:40decline you look at the NASDAQ 100 the
130. 4:42QQQ it's down about 33 of the year now
131. 4:45we know that there are dozens if not
132. 4:47maybe a couple hundred stocks that are
133. 4:49probably easily down more than 50
134. 4:51percent or so you see that downtrend
135. 4:53look at that support we've been talking
136. 4:55about a round trip for the major indices
137. 4:57the s p and the NASDAQ back to their
138. 5:00pre-pandemic highs we're just kind of
139. 5:02like a few percent off of those recent
140. 5:04lows from a couple weeks ago and there's
141. 5:06really no meaningful effort to bounce we
142. 5:09had that what 12 13 bounce you know off
143. 5:12of those mid October lows but it really
144. 5:14feels like that again if the market
145. 5:16can't rally after the midterms whatever
146. 5:18your expectation is there really feels
147. 5:21like we're going to be going into that
148. 5:23support Zone in the NASDAQ 100. yeah and
149. 5:25Jay Rice makes an interesting comment
150. 5:27here on I think he's on YouTube but stop
151. 5:29looking at and this has directed at us
152. 5:31and I respect this by the way stop
153. 5:32looking at Apple and meta there's 17
154. 5:35other stocks energy Banks and value
155. 5:37names versus expensive Tech names and
156. 5:39he's you're 100 right Jay and the reason
157. 5:41why you know we focus on specifically
158. 5:44these names is because they make such a
159. 5:45there's such a huge component of what
160. 5:47the broader Market is doing and I think
161. 5:49we look at Apple not necessarily in the
162. 5:52context of Apple but it potentially
163. 5:53could mean for the broader market so I
164. 5:55appreciate that comment but that's one
165. 5:57of the reasons why we look at them
166. 5:58yeah um thanks for that Jay um and then
167. 6:01here's one that Amanda put together a
168. 6:03nice little slide this is another one
169. 6:05that I think is important you can sit
170. 6:07here and harp on some of these stocks
171. 6:09that are down 80 90 but what's important
172. 6:12to us is like living through past bear
173. 6:15markets you need these frothy names you
174. 6:18need you know Traders use that
175. 6:19expression it's a zero it's going to
176. 6:21zero well very few stocks actually go to
177. 6:24zero here's a few stocks that could go
178. 6:27to zero we're not saying that they're
179. 6:28good shorts from here or whatever and
180. 6:30they all captured a bit of enthusiasm
181. 6:33from investors over the last few years
182. 6:35when you think about a carvana and how
183. 6:37much it sounds 97 there were stocks that
184. 6:40were NASDAQ Darlings in 99 2000 that
185. 6:43lost 90 some percent there's Open Door
186. 6:46upstart a firm there's some similar
187. 6:48themes there some were spacks some were
188. 6:51these uh buy now pay laters you know a
189. 6:54lot of different models that worked in a
190. 6:56zero interest rate environment don't
191. 6:58work anymore and and then these last two
192. 7:00guy meme stocks AMC bed bath they feel
193. 7:02like these stocks are either headed to
194. 7:05be small children hat sizes or maybe
195. 7:07zeros yeah and again I I would submit
196. 7:10these are all these are all encouraging
197. 7:12signs these are typically what takes
198. 7:13place towards the the end of what we've
199. 7:17seen is a pretty interesting cycle now
200. 7:19the end of doesn't mean we can't last
201. 7:21for a few more months or so but at least
202. 7:23these things are starting to come back
203. 7:24down to Earth because if the froth were
204. 7:26still in these names I would submit
205. 7:28we're a lot farther away from the end or
206. 7:31you know the end of the of the move
207. 7:33lower in the broader market and again
208. 7:35quickly about AMC what really upset me
209. 7:37the most things about AMC and GameStop
210. 7:39is there was this misguided belief from
211. 7:42a lot of people that as long as they
212. 7:43owned or held on to those stocks almost
213. 7:46by definition they couldn't go lower
214. 7:48what we were trying to point out is
215. 7:49that's somewhat misguided and when you
216. 7:51had some of the moves we've seen to the
217. 7:53upside you should have been taking
218. 7:54advantage of that because quite frankly
219. 7:56I will tell you that's exactly what may
220. 7:58management did yeah you know it's
221. 8:00interesting and throw up carvana up
222. 8:02there you know our our co-host Danny
223. 8:04Moses of our on the tape podcast who guy
224. 8:06and I both believe is a genius investor
225. 8:08he was featured in The Big Short he's
226. 8:10been on the market call
227. 8:12um with us and and he's looking for some
228. 8:14of these financialized companies you
229. 8:17know they take a certain model and they
230. 8:19financialize them and they make it sound
231. 8:20like some really new exciting thing and
232. 8:23Danny had been on this short trade since
233. 8:26the stock was 300 and he said to us
234. 8:28earlier this year when the stock was 80
235. 8:30down from 300 he says it's a better
236. 8:33short at 80 than it was at 300 because
237. 8:36the fundamental stuff is starting to
238. 8:38come Unwound and apparent to a lot of
239. 8:40different investors no listen and you've
240. 8:42seen what's going on here it's
241. 8:43fascinating to me at least to see you
242. 8:46know talk about the bloom off the roads
243. 8:47and you know what's interesting you know
244. 8:48I say all the time that's what makes
245. 8:49markets I'm just reading through the
246. 8:51comments and thank you folks for sharing
247. 8:52you know we have one comment that apple
248. 8:54is cheap in this environment and two or
249. 8:57three comments later apple is over
250. 8:58overpriced and people always say the
251. 9:01market is efficient and yet to a certain
252. 9:02extent it is but when you have Divergent
253. 9:04opinions like that that's why you see
254. 9:06the moves that we've been seeing over
255. 9:08the last you know nine to 12 months so I
256. 9:10appreciate those comments but there's
257. 9:11some other things that are going around
258. 9:12as well you know listen Dan we've talked
259. 9:14about energy for a while quickly just to
260. 9:16sort of Get Off Script here but the oih
261. 9:18has gone up and you mentioned this last
262. 9:19week from the end of September when it
263. 9:22was trading I think around 210 to levels
264. 9:24we're seeing today you're talking about
265. 9:25an oih it's up fifty five zero percent
266. 9:28in the course of a month which is a
267. 9:31staggering move and we're at levels that
268. 9:33we last saw in June
269. 9:34yeah no this one I mean again you know
270. 9:36we've talked about this and on our
271. 9:38podcast on Friday with um you know uh uh
272. 9:42Vinnie Daniels and Porter Collins and
273. 9:43Danny Moses we were talking about energy
274. 9:44they love energy and it's funny they
275. 9:47still don't like Tech but they love
276. 9:48energy and I asked them a question I
277. 9:50think this is really important I said
278. 9:51you're not shorting Mega cap Tech here
279. 9:53and you're probably not buying large cap
280. 9:56integrated oil here or or Energy
281. 9:58Services and they said we're not and you
282. 10:00don't have to just because you'll still
283. 10:01like something you own it or you're
284. 10:03shorted doesn't mean you have to be
285. 10:04doing that thing right now because entry
286. 10:07and exit points are obviously really
287. 10:08important here this is so we're at
288. 10:11levels now in the oih where I think the
289. 10:14right thing the smart thing to do is say
290. 10:16okay we've had this ridiculous run where
291. 10:18levels we last Saw back in June the
292. 10:21smart move the discipline moves it takes
293. 10:22some money off the table I will tell you
294. 10:25I still think there's another leg higher
295. 10:27in these things I'm not submitting that
296. 10:28I'm right and the smart thing again to
297. 10:30do is to start to Pare down risk but
298. 10:33there's clearly something going on in
299. 10:35energy and one of the things that I've
300. 10:36said for a while is post-election which
301. 10:38by the way is tomorrow I encourage
302. 10:40everybody to go out and vote
303. 10:42um I think that's when Energy starts to
304. 10:43get its froth back then yeah well it
305. 10:46could be and again I think the dollar
306. 10:47weakness is something to keep you know
307. 10:50and we've been talking about the U.S
308. 10:52dollar Index has come back to that
309. 10:54uptrend I know Carter has been charting
310. 10:56that one too that's obviously of
311. 10:58importance to us and and of course
312. 11:00yields so we're going to keep uh updated
313. 11:02on all of that stuff I just want to make
314. 11:04one point guy about the meta you know
315. 11:06it's bouncing off of those cuts okay and
316. 11:08I've been buying I've been telling our
317. 11:10listeners I bought a little Amazon last
318. 11:11week after it Gap lower I bought a
319. 11:13little PayPal after it Gap blower I
320. 11:16bought meta a week and a half ago after
321. 11:18their earnings
322. 11:19um in and around like the high 90s or
323. 11:21something like that I also bought snap
324. 11:23and I was long a little snap into that
325. 11:25print and I bought a lot more and it
326. 11:27averaged down my average got to below
327. 11:29eight dollars I'm going to tell you this
328. 11:30stocks rallying here today I think guy
329. 11:33you mentioned it earlier I think Barry
330. 11:35Diller um iaci chairman he was saying
331. 11:38that he thinks um you know Tick Tock
332. 11:40probably gets banned here that would be
333. 11:42um huge for meta it would be probably
334. 11:44pretty big for snap that was one of my
335. 11:46thesis I'm actually going to be out of
336. 11:48this stock it's filled in this Gap here
337. 11:50I just want to kind of give an update
338. 11:51there I've been trading around it for
339. 11:53months and months and I've had a couple
340. 11:54decent trades I had a really bad trade
341. 11:56into this last print when it was down
342. 11:58almost 30 percent but I traded my way
343. 12:00out of it here it is filling in the Gap
344. 12:02average down and I'm going to take that
345. 12:03trade off here I'm still in meta I'd
346. 12:05like to see it move up to 110 and I
347. 12:07actually have a longer term or time rise
348. 12:09in in PayPal Amazon and I also bought
349. 12:11some alphabet last week all right yeah
350. 12:14let's bring them in but real quick you
351. 12:15know I listened to Barry Dill this
352. 12:17morning and he said you know he was
353. 12:18pretty convinced that tick tock's gonna
354. 12:20be banned here in the United States I'm
355. 12:21not nearly as convinced but now you have
356. 12:23more and more uh politicians talking
357. 12:26about exactly that so we'll see I will
358. 12:28tell you in my opinion if Tick Tock is
359. 12:30banned in the United States well first
360. 12:32of all we have to talk about the
361. 12:34ramifications for U.S China relations
362. 12:36but in terms of Facebook specifically I
363. 12:38think that immediately becomes 125 stock
364. 12:41but we'll see Carter you've been waiting
365. 12:43in the weeds sorry I'm two minutes late
366. 12:44bringing you in how are you sir in the
367. 12:47wings of the weeds or sometimes there's
368. 12:48weeds in the wings and you never know
369. 12:50anyway how uh yeah interesting tape
370. 12:54today we've been plus or minus plus or
371. 12:55minus we seem to be rallying here a bit
372. 12:58but either way I think the sequence of
373. 13:00we know it was an epically bad month of
374. 13:03September an epically good month of
375. 13:06October and now it's kind of a push uh
376. 13:09this month while still young you've got
377. 13:12real damage being done to some of the
378. 13:14especially big weak names Tesla apple
379. 13:16and you've got continued bounces in
380. 13:20old-fashioned names like McDonald's and
381. 13:22schlumbergine and it speaks to something
382. 13:24you've been talking about I mean here
383. 13:26today the s p is up probably four tenths
384. 13:29of one percent and the Dow Jones is up
385. 13:31close to one percent with the NASDAQ
386. 13:33underperforming the Russell trading
387. 13:36lower as I'm looking at here the vix
388. 13:37unchanged slightly higher so this is one
389. 13:40of those really strange days that you've
390. 13:42alluded to in a lot of the work that
391. 13:43you've been doing
392. 13:45right and it is a it's rotation right as
393. 13:47money comes out of uh some of these
394. 13:49great
395. 13:51um Marquee uh big super cap names it's
396. 13:55finding its way into again things like a
397. 13:58McDonald's or Honeywell or or slumberger
398. 14:01the issue for the market though and this
399. 14:04is important right is the market in
400. 14:06better shape or worse shape in any given
401. 14:08day than the prior day or the prior
402. 14:10month the prior week and in principle
403. 14:13the ones that are weak Tesla Apple are
404. 14:16not in better shape they're continuing
405. 14:19to be heavy stay down and so let's say
406. 14:22they're just in the same shape they're
407. 14:24impaired but the ones that have bounced
408. 14:26are not in better shape because the
409. 14:28potential or a great deal of it has been
410. 14:31exploited meaning if Honeywell is up 30
411. 14:33and it is and McDonald's up close to
412. 14:36that while they're in hindsight or not
413. 14:38there was opportunity three four five
414. 14:40weeks ago that opportunity has been
415. 14:42exploited so the net of it all is that
416. 14:44the market is in less of a position I
417. 14:47would think to move higher than it was
418. 14:49just three four five weeks ago so Carter
419. 14:52you heard me just mention the fact that
420. 14:53the NASDAQ 100 the QQQ is only up like
421. 14:56three and a half percent off those loads
422. 14:57from a couple weeks ago that big
423. 14:59reversal day and the s p the chart that
424. 15:01we just saw is up a bit more than that
425. 15:03and so again it's speaking to that um
426. 15:05kind of rotation that we're seeing and
427. 15:06so with interest rates you know the
428. 15:0810-year U.S treasury yield is is
429. 15:10basically 4.2 percent right now very
430. 15:13near the highs of this cycle it just
431. 15:15seems like investors are going to still
432. 15:17hit the sell button on what they think
433. 15:19are high valuations even the name like
434. 15:21apple you know at 21 times or something
435. 15:23seems expensive especially if you think
436. 15:25the S P 500 troughs at like 14 or 15
437. 15:29times and then the ones that have been
438. 15:31bit up not to just keep harping on a
439. 15:34McDonald's but it's a prototype that's
440. 15:35throughout the market McDonald's is
441. 15:37trading at 28 times so now this is not a
442. 15:39growth business and everybody knows that
443. 15:41and it's just a question of should it
444. 15:43trade to 38 times or or 50 times I mean
445. 15:46the the the the point is that there
446. 15:49isn't uh there aren't a lot of good
447. 15:50moves on the board borrowing of course
448. 15:53always trying to find really bombed out
449. 15:55stocks that are truly bottoming bearish
450. 15:58to goalish reversals one of the stocks
451. 16:00that doesn't look like it's bottoming is
452. 16:03Tesla and you brought a chart with you
453. 16:05talking about what appears to be a bit
454. 16:07of a head and shoulders we've talked
455. 16:08about this for a while I mean I am I'm
456. 16:10agnostic when it comes to these things I
457. 16:12don't care one way or another we just
458. 16:14try to look at them through the lens
459. 16:15that we look at things but Tesla
460. 16:17technically does not look particularly
461. 16:19good here Carter no it has all the
462. 16:22elements of a an important reversal it's
463. 16:24been underway for a long time this of
464. 16:28course
465. 16:29um depicts that what you have and this
466. 16:31is this is your chart and it's excellent
467. 16:34the
468. 16:35um the the the imagination let me just
469. 16:39say this is it can go as low as the
470. 16:41imagination will allow if you think at
471. 16:43all all the big round trips that we've
472. 16:45seen not to compare this to Peloton or
473. 16:47Zoom or carvana because whereas those
474. 16:50operating businesses are basically in
475. 16:52question that's not the case here what
476. 16:54we do know is when you have a great
477. 16:56Ascent over a multi-year period when you
478. 16:59unwind it you unwind a good chunk of it
479. 17:02we're probably halfway back is it going
480. 17:04to go all the way back to its covered
481. 17:05low I would say absolutely not but is it
482. 17:08going to stop going down here I would
483. 17:09say absolutely not yeah so Carter you
484. 17:12know again we we just put up a little
485. 17:14head and shoulders unworth charting
486. 17:16today people you you did some extensive
487. 17:18charting over different time spans with
488. 17:20a lot of different lines and none of
489. 17:21them look good even when you know it
490. 17:23kind of broke that long-term uptrend it
491. 17:26got it literally hit resistance right at
492. 17:28that prior support and got rejected here
493. 17:31and so you know the other thing is and I
494. 17:33know you don't really care about a lot
495. 17:35of the qualitative stuff as it comes to
496. 17:37some of these stories I mean there's
497. 17:39something really important going on here
498. 17:40is that Elon Musk was selling a lot of
499. 17:43his Tesla holding over the course of the
500. 17:45last year to finance paying taxes the
501. 17:48finance buying Twitter I'm taking it
502. 17:50private that he's doing solely with some
503. 17:52debt and so when you think about now I
504. 17:55guess he hasn't sold stock but he's
505. 17:57likely pledged a lot of his Tesla stock
506. 17:59to the banks that helped him get this
507. 18:02deal done okay and so all of a sudden if
508. 18:05you were a Tesla shareholder okay you
509. 18:07are very invested in the job that he
510. 18:10does over over there at Twitter he could
511. 18:13trip a debt Covenant okay and therefore
512. 18:15he could have to come up with more
513. 18:17equity and how would he do that he could
514. 18:20have to sell Tesla stock and let me tell
515. 18:22you the shares that are pledged to the
516. 18:24banks right because he didn't sell it
517. 18:26they actually might have a margin call
518. 18:28for him and therefore you could have a
519. 18:30scenario where stuff going on over at
520. 18:33Twitter which a private company that he
521. 18:35owns individually and he is the largest
522. 18:37participant meaning by
523. 18:40um followers okay but by also tweeting
524. 18:42and all the engagement and stuff like
525. 18:44that and he's saying some things that
526. 18:46might not jive with our government with
527. 18:49might not jive with his customers of
528. 18:51Tesla or whatever I mean the list goes
529. 18:52on and on and on and so I think for us
530. 18:55to think just because twtr doesn't trade
531. 18:58anymore to think that that's not
532. 19:00impacting you know Tesla I think is kind
533. 19:02of ridiculous here and this stock acts
534. 19:04horrible and I tweeted this earlier this
535. 19:06is one of the worst looking charts in
536. 19:09the entire stock market and it's still
537. 19:11has a 600 billion dollar market cap
538. 19:13trading evaluation that doesn't make
539. 19:15sense to anybody other than massive
540. 19:17Fanboys of Elon Musk and his cars
541. 19:20100 and also there is uh there is a
542. 19:23long-standing pattern when a company
543. 19:25gets out of its uh Lane so to speak you
544. 19:29know when Sony goes buys Universal
545. 19:31Pictures or Paramount whatever they did
546. 19:33and you have hundreds of examples just
547. 19:35go to any Harvard Business School study
548. 19:37it's usually not only not good but the
549. 19:40people that do it lose their jobs now
550. 19:42that's never going to happen because he
551. 19:44owns and he is the the um the sort of
552. 19:47the king of Tesla but you just remember
553. 19:49it was the chairman of Pepsi that came
554. 19:52in to take over management of apple and
555. 19:55the first thing he did was he fired
556. 19:57Steve Jobs
557. 19:58you know sometimes the Creator needs to
558. 20:01stay where he is best suited and not go
559. 20:04off and do things that are off scripts
560. 20:06but look at this look at this chart here
561. 20:08this is very straightforward we have the
562. 20:10trend line we have the break-in Trend we
563. 20:12throw back to the penny we hit our head
564. 20:14uh and and there's so many different
565. 20:16iterations uh for Tesla I mean you could
566. 20:19draw the lines that way you can you can
567. 20:21put in the the brake juncture from the
568. 20:23June low basically I mean look those
569. 20:25purple arrows tell the tale so much of
570. 20:28this is technical because we know it's
571. 20:30not valuation uh It's just sometimes a
572. 20:34stock is ascending and sometimes it's
573. 20:37descending and we're in the case the
574. 20:39latter right now yeah and John Anderson
575. 20:41on the comments at 175 that's a level
576. 20:43that I've been talking about for a while
577. 20:45I mean you know I think if it were to
578. 20:47get there that's something you can trade
579. 20:48against but um I'm pretty listen I'm not
580. 20:51convinced of anything but it feels as
581. 20:52though that's somewhat inevitable given
582. 20:54the environment we find ourselves in we
583. 20:56talked about Apple earlier we made some
584. 20:57comments you brought some charts to sort
585. 20:59of back up what we're saying the charts
586. 21:01are the relative performance of Apple to
587. 21:03the s p and how it looks as though
588. 21:05things are starting to break down here
589. 21:06Carter yeah and it's in they're very
590. 21:08precise lines and the best part about
591. 21:10them is they're not my lines uh these
592. 21:13lines are the lines it's simply ratio
593. 21:15chart Apple relatively s p this is going
594. 21:17back over two three years but you can
595. 21:19see we are breaking Trend if you look at
596. 21:22a longer term chart we've got the same
597. 21:24circumstances and look how well Apple
598. 21:26has adhered to this line and we are just
599. 21:29below it and if you did the all data
600. 21:31relative chart which is simply Apple's
601. 21:33relative performance to
602. 21:36um the s p we have the same circumstance
603. 21:39I would point out that look in the last
604. 21:4120 years for what it's worth if maybe go
605. 21:43back to the second chart in the middle
606. 21:45in the last 20 years there you have a
607. 21:4720-year chart Apple has outperformed the
608. 21:49s p in 1500 performed in five so it's
609. 21:52one out of four times on our performance
610. 21:54but here's here's the thing that really
611. 21:56gets crazy
612. 21:57um if you were to consider Apple's
613. 22:00performance over the past 20 years
614. 22:02Apple's split adjusted price is 25 cents
615. 22:06and it's keger is basically 37 38 that's
616. 22:12compounded annual growth rate versus the
617. 22:14market at 7.6 so in that chart you're
618. 22:16looking at a hundred grand invested in
619. 22:19the s p is 430 Grand now 100 Grand in
620. 22:23apple is 57 million dollars very
621. 22:27humbling for all of us who didn't do
622. 22:29that even with a dollar and kept it or
623. 22:31ten thousand but the point is nobody
624. 22:34stays on top forever and this doesn't
625. 22:35mean this has to end the way it ended
626. 22:37for Cisco largest company in the world
627. 22:40or Exxon largest company in the world or
628. 22:41GE or General Motors or U.S steel but
629. 22:45you can stay on top until you can't and
630. 22:48there's every reason to think that
631. 22:50Apple's not a good place to be you know
632. 22:52what's funny guy has made this point on
633. 22:55many occasions you know when it was a
634. 22:57value stock it traded at Value you know
635. 23:00like valuation it had growth like
636. 23:02Tendencies as far as their sales and the
637. 23:05way margins were expanding and where
638. 23:06they were feeling and now that it's like
639. 23:09no longer this year expected earnings
640. 23:11and sales growth about four percent okay
641. 23:13it's trading at 21 times the current
642. 23:16year and about 20 times the out year and
643. 23:19so that just kind of speaks to like this
644. 23:21kind of you know this over exuberance
645. 23:23about this company and that
646. 23:24outperformance and people think what
647. 23:26happened in the past is likely to
648. 23:28continue to happen in the future
649. 23:30um that being said you know a quick
650. 23:32swoosh Carter and this thing you know we
651. 23:34just talked about how some of those
652. 23:36stocks go into zero and all these other
653. 23:38things we're seeing some makings of like
654. 23:40six months from now we could see how the
655. 23:42stock market might have bottomed but it
656. 23:44probably won't bottom before Apple
657. 23:46trades below where people think it could
658. 23:48trade near term and down 22 percent on
659. 23:51the year versus the NASDAQ down 33
660. 23:53doesn't seem like it's there yet what do
661. 23:55you think there guy
662. 23:57I agree and that's the point that I've
663. 23:59been making for years and I'm glad you
664. 24:01brought it up and nobody seems to want
665. 24:03to hear it but you know when it was a
666. 24:05growth stock it traded a trough
667. 24:06valuation now that it's basically a
668. 24:08value stock it trades at a growth stock
669. 24:10valuation you can't have it both ways
670. 24:11and I think that's what we're coming to
671. 24:13realize now and it's not to cast
672. 24:15aspersions about Apple I mean it's
673. 24:16obviously one of the two or three most
674. 24:18important companies in the world but
675. 24:20it's just to point out that even apple
676. 24:22is not impervious to dealing with
677. 24:23valuation a certain point and I think
678. 24:25that's what the Market's trying to
679. 24:26figure out now Carter so we'll see you
680. 24:29brought some go ahead yeah no I would
681. 24:31say that if you look at so the essence
682. 24:32Center and Poor's actually has an S P
683. 24:34500 value index and growth index and
684. 24:36Apple has been in both of them three
685. 24:38times like when he was just at the end
686. 24:40of the PC Ron and you didn't have the
687. 24:42phone yet there it was it was a value
688. 24:44stock and there was no growth now it's
689. 24:45growth now I'll tell you and yet net
690. 24:47income the prior four years before kova
691. 24:50was essentially flat not earnings per
692. 24:52share because they're buying back a lot
693. 24:53of shares but net income flat for five
694. 24:55years and it basically doubles during
695. 24:57that that's that's a really important
696. 25:00point we made that point they have
697. 25:01bought back over a half a trillion
698. 25:04dollars worth of stock over the last 10
699. 25:05years people talk about Jack waltz or
700. 25:07welts managing their earnings at GE for
701. 25:09all those years I mean Apple when they
702. 25:11were having really not great earnings
703. 25:13growth they were able to kind of return
704. 25:15a ton of cash if you will Carter
705. 25:18over the last couple weeks you've been
706. 25:20highlighting what you've been calling
707. 25:21bearish to bullish reversals okay and
708. 25:24and giving us a bunch of names that you
709. 25:26think are starting to show some some I
710. 25:28don't know some some technical sort of
711. 25:30clout or maybe some sort of turn I
712. 25:32wanted to kind of throw this um block up
713. 25:34this is the SQ chart here and get a
714. 25:37sense for what you're thinking here
715. 25:39um because this one had a big gap after
716. 25:41its earnings after making new 52-week in
717. 25:44multi-year lows it's followed through
718. 25:45here today A little bit how's this one
719. 25:48look to you and it's no lines here just
720. 25:50that kind of declining 150 day just
721. 25:52curious your thoughts sure I mean it has
722. 25:54the element let me say this obviously to
723. 25:55qualify official and not to sound fishes
724. 25:58but you know for for my seat as I
725. 26:00learned it a bearish to bullish reversal
726. 26:02is when the actual
727. 26:03150 moving average the Smoothie maximum
728. 26:06goes flat and so obviously that's not
729. 26:07the case here but what is the case and
730. 26:09it's incontestable is that it's starting
731. 26:12to stop going down right yeah the stocks
732. 26:15it's dealt it's a rate of descent is
733. 26:17abating and in fact plus or minus it's
734. 26:20kind of flat since the summer yes it's
735. 26:23made a slight new lows here but this is
736. 26:25how it starts so the price action can be
737. 26:28characterized as developmental early
738. 26:31stage hopeful encouraging nascent
739. 26:33doesn't matter what word you want to use
740. 26:35they all apply I would I would be
741. 26:37inclined to do a little bit
742. 26:39yeah well guy will recall this too in in
743. 26:42past Cycles you know when bad news stops
744. 26:45causing bad price action after a long
745. 26:48period of bad price action
746. 26:50um you know it is one of those sorts of
747. 26:52situations where if it marries with the
748. 26:54sort of charts and the sort of stuff
749. 26:55that you're seeing that makes some sense
750. 26:57okay here was one Carter uh on work
751. 26:59charting this morning you had a no doubt
752. 27:01saying one area of the markets one theme
753. 27:04stands out and this is going to get guy
754. 27:06a little excited here it's the gold
755. 27:08miners it's the gold miners ETF the GDX
756. 27:11talk to us a little bit about this
757. 27:13all right so this was a table and uh if
758. 27:16you if you're just trying to do
759. 27:18sometimes uh take a different approach
760. 27:20or try to put things in perspective it's
761. 27:22three columns now the table is you can
762. 27:24see it's uh you have a the top part and
763. 27:27the bottom part it's too much to fit on
764. 27:29one screen so we've cut it in half here
765. 27:30but if you look at the month of
766. 27:32September I mean I've done everything
767. 27:33you can see every aggregate there is
768. 27:35from Europe Emerging Markets from junk
769. 27:38bonds every single sector in the s p
770. 27:40semiconductors but everything is down in
771. 27:44the month of September we know except
772. 27:46and and gold two gold bullion was down
773. 27:49but what wasn't down gold stocks coal
774. 27:52miners now in the month of October the
775. 27:54middle column almost everything was up
776. 27:56not everything but almost and indeed
777. 27:58gold miners were up again and now in the
778. 28:01month of November a lot of things are
779. 28:03down some are up but what's up yet again
780. 28:06bull miners that's what relative
781. 28:10strength is or something developmental
782. 28:12nascent early in the guys and most
783. 28:14important that the miners are up when
784. 28:16the bullion wasn't up in October it's
785. 28:20good sign without question the resource
786. 28:22names are actually starting to trade
787. 28:23well the last week week and a half I
788. 28:25mean you throw on top of that energy
789. 28:27which we mentioned the oih up over 50
790. 28:30percent in the course of a little over a
791. 28:32month and that speaks to maybe something
792. 28:34taking place
793. 28:36post-election maybe some of these
794. 28:38commodity names that clearly have been
795. 28:39under pressure maybe now that the
796. 28:42elections and they'll no longer have a
797. 28:43bullseye on their back maybe that'll
798. 28:45free some of these names to go higher
799. 28:47Dan
800. 28:47yeah no doubt about that I mean again
801. 28:50I'm starting to think about what are
802. 28:51some of the stories where again bad news
803. 28:53is not perceived bad by market
804. 28:55participants it's already kind of in the
805. 28:57stock valuations are getting kind of
806. 28:59compressed and people are going to start
807. 29:01thinking about what is the out year
808. 29:03estimates start to look like okay we've
809. 29:06gotten through a lot of earnings over
810. 29:07the last few weeks couples still on our
811. 29:09radar here guy curious your take on Lyft
812. 29:12and this is one where I think it's kind
813. 29:13of interesting okay because again the
814. 29:16story is well known I mean they are
815. 29:18basically North American Rideshare whole
816. 29:20host of issues as it relates to kind of
817. 29:23you know Staffing demand cost of those
818. 29:25Staffing there's been all these ballot
819. 29:27initiatives whether to make these gig
820. 29:29economy workers
821. 29:30um full-time employees that would raise
822. 29:31the cost
823. 29:32um of the company here thoughts because
824. 29:34this is a five billion dollar market cap
825. 29:36they have 1.8 billion in cash a billion
826. 29:40in debt here and you think about it from
827. 29:42an Enterprise standpoint given their
828. 29:44like four billion dollar Enterprise
829. 29:46Value seems kind of cheap now on
830. 29:48adjusted basis they're making money on a
831. 29:50gap basis they are not we know that
832. 29:52they're losing a lot there's a lot of
833. 29:53stock based comp here curious how you
834. 29:55think about a stock like this let's have
835. 29:57a decent rally over the last let's call
836. 30:00it month or so off of the lows because
837. 30:02the slightest bit of good news and this
838. 30:04Stock's kind of raging that being said
839. 30:07you know worse than expected and no
840. 30:10light at the end of the tunnel and this
841. 30:11thing's going to be testing those recent
842. 30:13all-time lows yeah I mean I look at this
843. 30:14Carter probably looks at this as a pair
844. 30:16of twos and I'm sure that he's right I
845. 30:18say to myself you know their Pathway to
846. 30:19profitability for Lyft is a lot clearer
847. 30:22than it is for Uber I mean that's just
848. 30:23my view we'll see I also look at this
849. 30:26and say you know what there's still a
850. 30:27gap in the chart back from May we'll see
851. 30:29if we fill that moving averages are
852. 30:31clearly not helping but you know the
853. 30:33fact that we bottom out as long as we
854. 30:35have I mean maybe it's giving us a
855. 30:37launch pad you know for a significant
856. 30:38move higher we'll see
857. 30:40yeah Carter any any thoughts on a name
858. 30:43like this yeah I mean so here too we one
859. 30:45could see or want to see that hey isn't
860. 30:49it sort of stabilized he's not really
861. 30:50making sharp new lows and to some extent
862. 30:52that's true the interesting thing of
863. 30:54course is the Divergence with Uber
864. 30:56whereas Lyft has made a new 52-week low
865. 30:59on the 13th of October with most stocks
866. 31:03Uber made its low back in June July
867. 31:08um I don't know anything about which
868. 31:09one's better I have getting in the back
869. 31:11of both of them but after that uh you
870. 31:14know it's just it's just about the chart
871. 31:16one one thing I just say is the implied
872. 31:18move in the options Market okay so the
873. 31:20the straddle the at the money the stocks
874. 31:23just below 14 the 14 strike call in the
875. 31:2614 strike put they're each about a
876. 31:28dollar forty that's two dollars and
877. 31:29eighty cents if you just thought the
878. 31:31stock was going to move basically 16 in
879. 31:34either direction you just knew it's
880. 31:35going to move you could buy that
881. 31:36straddle that's not a strategy that any
882. 31:38of us really agree with it's really a
883. 31:40difficult way to make money especially
884. 31:42into events like this but then think
885. 31:45about it this way let's just say you
886. 31:46thought the stock could go above 1540
887. 31:49between now and Friday's close that's
888. 31:51half the implied move you define your
889. 31:53risk and buy that call I still don't
890. 31:55love doing those sorts of Trades hard
891. 31:57way to make money unless you have high
892. 31:59conviction on the directional move but
893. 32:02this one's interesting to me I almost
894. 32:03think you wait and that this thing were
895. 32:05to Gap lower they have job Cuts they
896. 32:07have this they have that maybe that's
897. 32:09the opportunity to kind of buy it after
898. 32:10it's already Gap all right that's it
899. 32:12guys that's the market call no way yeah
900. 32:15that's kind of it guys I mean I mean we
901. 32:18try to be we try to be respectful of
902. 32:20people's time I will mention that listen
903. 32:22best team in baseball won the World
904. 32:25Series I know you Dodger fans would love
905. 32:27to say otherwise but the Astros are just
906. 32:30better than everybody else the Rangers
907. 32:32dropped Chris Kreider down to the third
908. 32:34line last night and in overtime loss
909. 32:37against the Red Wings but that's coach
910. 32:38Gallant making a statement as you know
911. 32:40know Carter I'm sure you're very well
912. 32:42aware but that's it for today's market
913. 32:44call as Dan mentioned I want to thank
914. 32:45factset for providing us with all the
915. 32:48charts and data for this broadcast if
916. 32:50you enjoyed the video be sure to hit the
917. 32:52like button or or smash the like button
918. 32:55or something smash people say that I
919. 32:58would never utter in my world leave us a
920. 33:00comment subscribe to risk reversal media
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922. 33:06out the on the tape Special Edition
923. 33:09that's going to drop any minute now with
924. 33:12nuriel rabini we'll be back tomorrow at
925. 33:141 pm thank you Carter as always hasta la
926. 33:18vista people see you later thanks
927. 33:21[Music]
928. 33:23[Applause]
929. 33:33thank you