Financial television does a great job of promoting fear. Please keep in mind that the news only cares about one thing: ratings. For example, CNBC’s highest ratings ever were during the financial crisis of 2008-09. Their lowest ratings are when the market is at new highs. Like I always say, you don’t watch the Weather Channel when it’s 80 degrees and sunny outside. You turn it on when a hurricane, tornado, or blizzard is possibly approaching.
The reason I mention this is that today, I browsed through the three major financial networks, and they were all making out this week’s CPI report to be a “binary” event. Almost as if the market is a small cap Biotech company about to report Phase 2 results.
As you know, the main goal of this product is to promote calm and confident traders. In other words, I don’t want members to live in fear. I’m not complacent about any economic reports; I just don’t care about them because the majority of economic reports are lagging, and the stock market is leading.
As I’ve said many times in recent videos, I view the price action of the market for the past few weeks as normal. We had an incredible run from early November until early March, and the market has been consolidating those gains over the past few weeks down to key support levels. More importantly, many of the leading growth stocks (such as NVDA, SMCI, LLY, and UBER) are visiting their 50-day/10-week areas for the first time since their recent strong runs, and I view this as normal.
If any report is interpreted as negative, and the market sees significant distribution, then I will make the proper adjustments, be flexible in my approach, and stick to my stops. If you’re ever too nervous about a position, one suggestion is to reduce it to a “sleep at night” level. Again, the main purpose of this memo is to remind you NOT to live in fear when it comes to the market. The key is to stay focused and undistracted in a world full of noise and distractions. Thank you and good luck for the remainder of the week.