Insider Tips - Weekly Stock Market Report - Week January 13, 2025

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Weekly Insider Tips - January 13, 2025

Welcome to this edition of Insider Tips! It’s been a challenging market, with consistent red signals and downward trends. Despite positive job market news, the market has reacted negatively due to implications of higher interest rates. Key indexes like the NASDAQ, S&P 500, and Dow Jones are below their 50-day moving averages, signaling further declines. Treasury yields are climbing, pressuring risk assets like Bitcoin and equities. Individual stocks like Netflix, Apple, Tesla, and NVIDIA are facing sell-offs, while others like Amazon and MicroStrategy show potential but remain volatile. Respect the red market, stay strategic, and remember: a green market will come.

Technical Analysis

The market remains red, indicating a downward trajectory. The NASDAQ, S&P 500, and Dow Jones are all below their 50-day moving averages, with momentum potentially driving them toward their 200-day averages. The New York Composite is following a similar trend. This consistent downward pressure reinforces the need to respect market signals and avoid trying to outguess the broader market.

The VIX, or "panic index," has risen, reflecting growing market uncertainty. Treasury yields are climbing as the market anticipates higher interest rates, regardless of the Fed's intentions. This puts additional pressure on equities and risk assets, driving further declines.

Market Trends

Interest Rates and Treasuries:
Despite the Fed's narrative, the market is dictating higher rates. The 20-year Treasury (TLT) has been decimated, with investors losing principal value even as yields rise. Fixed-income instruments remain unattractive given their current risk-return profile.
Bitcoin and Risk Assets:
Bitcoin's decline mirrors broader market risk aversion, as higher Treasury yields offer a safer alternative. This shift underscores the challenges faced by speculative assets in a tightening environment.
Housing Market:
The housing index has seen a steep decline, signaling potential recessionary pressures. A drop from 836 to under 700 points to broader concerns about economic stability.

Individual Stocks

Netflix: Down over 4%, Netflix has dropped below its 50-day moving average, reflecting broader market struggles.
Apple: Similarly below its 50-day moving average, Apple remains a candidate for selling in-the-money calls.
Tesla: Despite being in a technical breakout, Tesla appears poised for a pullback, potentially to the $365 level.
NVIDIA: Consolidating with little movement, NVIDIA remains a long-term prospect but lacks short-term momentum.
MicroStrategy: Volatile as always, MicroStrategy offers opportunities for high premiums on options but is currently risky amid broader market weakness.
Amazon: Still technically in a breakout but showing signs of pulling back to its moving averages, Amazon's earnings in three weeks could introduce further volatility.

Key Takeaways

Respect Market Momentum: The market is always right. Position yourself based on probabilities, not predictions.
Downward Bias: With major indexes and stocks below key moving averages, the short-term outlook remains bearish.
Treasuries Aren’t "Safe": Rising yields are not compensating for principal losses, making them unattractive in the current environment.
Selective Stock Strategies: Focus on selling in-the-money calls to generate income while managing downside risk.

Conclusion
The market is in a clear downward trend, with red signals dominating across indexes and individual stocks. Rising Treasury yields and broader economic uncertainties add pressure, but these cycles are part of the market's natural rhythm. Stay disciplined, play the downside probabilities, and prepare for the inevitable recovery. As always, thank you for tuning in, and I’ll see you next week!

Current Market Condition:

The red market signals a clear downward trend, with major indexes like the NASDAQ, S&P 500, and Dow Jones all falling below their 50-day moving averages, indicating continued weakness and likely movement toward their 200-day averages. The consistent red momentum underscores the importance of respecting market signals rather than attempting to predict a reversal prematurely. This environment reflects a scenario where bad news exacerbates declines, and even seemingly good news—such as a strong job market—is interpreted negatively due to implications of higher interest rates. The message is clear: play the probabilities, stay cautious, and align strategies with the market’s downward bias.

Stock Tip of the Week:

🚀 As MicroStrategy (MSTR) makes a bounce, we’re seeing incredible opportunities for covered calls to generate income. 💰 Today, I rolled up my position and locked in $7,000 in premium—watch the trade in action! 📈 Let’s dive into the strategy that makes this possible.

In this exclusive video, I’m breaking down how MicroStrategy (MSTR) has dropped $240 from its high—and yet, I’m still generating steady income using covered calls. Curious how I’m doing it? 💰 Watch the full breakdown to see how this strategy continues to deliver passive income, even in a volatile market.

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🚗 Tesla Drops, But My Income Doesn’t!

In this week’s video, I break down how Tesla (TSLA) dipped this week and show you exactly how I not only protected the account but also generated $49K in income—including $45K in JUICE! 💰 Watch to see the strategy in action and how you can make volatility work for you.

Podcast Episode this Week:

🎙️ Meet Michael Drew: CEO of Real Estate Done 4 U, with over 1,000 transactions and a mission to help investors replace their W2 income with rental income. Michael shares his strategies for financial independence and his motto: “Don’t wait to buy real estate; buy real estate and wait.” Don’t miss it!