Date: 2024-12-17

Analyzing the LIVE Marketcast Call with Christian Tharp, CMT

As financial markets continue to fascinate and perplex both experienced and novice investors alike, insights from seasoned market analysts like Christian Tharp, CMT, prove invaluable. In a recent Marketcast call, Tharp delved deep into the current dynamics of the market, offering a professional assessment of its trends, potential corrections, and what investors might anticipate as they navigate through the shifting landscapes of indices like the NASDAQ, S&P, and others.

Key Topics Covered in the Call

The Uncertain Trajectory of Market Indices

The primary focus of the discussion was on the movement of major market indices, which included the NASDAQ and the S&P 500. A noteworthy observation made by Tharp highlighted a decoupling in the index movements. While tech sectors have somewhat buoyed the NASDAQ, other sectors and broader indices like the S&P 500 and the NYSE have shown signs of declining. This divergence paints a complex picture for investors who might be navigating based on traditional indices’ performances.

The Role of Macros and Market Fundamentals

Tharp touched upon several macroeconomic factors that might influence the market, such as rate cuts and the inverted yield curve — aspects often overlooked in daily market analysis yet critical for understanding long-term trends. This discussion was particularly pertinent as it shed light on historical precedents and the potential implications of these economic indicators on future market movements.

Predictions for Upcoming Market Corrections

One of the more critical analyses offered during the call was the discussion on potential market corrections. Reflecting on the lack of significant corrections in recent years, Tharp expressed caution about the market’s ability to sustain continued growth without adjustment. He questioned whether the market could withstand another six months without experiencing a correction of 10% or more, a sentiment that resonates with many investors considering the extended period of growth post-2020.

Technical Insights and Trading Strategies

In addition to broad market trends, Tharp provided specific insights into stock performance, including individual stocks like Tesla and Broadcom. He discussed trading strategies, highlighting options like strangles and straddles which could be beneficial in volatile market conditions. Through these examples, listeners gained a practical understanding of how to apply technical analysis to enhance their trading strategies in real-time market conditions.

Implications for Investors and Future Trends

The detailed analysis provided by Christian Tharp offers several takeaways:

• Volatility and Divergence: Investors should brace for continued volatility and divergence among different sectors and indices.
• Economic Indicators: Close attention should be paid to macroeconomic indicators that historically precede market declines or corrections.
• Preparedness for Corrections: The market’s resilience is questionable under current strains, and a correction could be due sooner than later. Preparing for such eventualities is crucial in risk management.
• Technical Analysis Application: Utilizing technical analysis to make informed trading decisions can mitigate risks associated with market volatility.

Conclusion

The insights from Christian Tharp, CMT, during the LIVE Marketcast call provide a robust framework for understanding and navigating the complexities of today’s financial markets. Investors, both seasoned and new, will find the analysis of current market trends and future predictions crucial as they develop strategies to safeguard and grow their investments in a fluctuating economic environment. Keeping abreast of such detailed and expert analyses will be key to successfully navigating future market challenges and opportunities.

Watch this video below for more info:

LIVE Marketcast Call W/ Christian Tharp, CMT



2024-12-17 02:39:14
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Video transcript:
alrighty happy Monday to you too Colin hope everybody can hear me everyone could just confirm that would be great don’t want to get KN deep into the call here and find out that no one can hear me make sure I’m not on mute here nope we’re de all right so we’ll give everyone here a few minutes to get on and and again don’t be shy if you can hear me just let me know that would be great Market moving higher as we expected well an ask that kids the only thing moving up and good morning everybody yeah that’s about the truth Barry it is uh we are pretty drippy over here slashy outside for sure but supposed to be close to 60 today so that’s cool hey Tom got some snow on the Pocono yeah that’s part of the reason we’re kind of slushy here that snow we had was on the ground there for a couple days and yesterday combined with today’s temps are melting it so but uh all right we’ve waited long enough go ahead and hop into it here and uh yeah let’s uh start with what we were just commenting on um you know it has felt like the markets are just moving higher moving higher moving higher when the reality is they’ve been moving lower moving lower moving lower uh certainly we have the ndx here that we look at uh that you know has been notching new highs off and on for the past couple weeks uh two weeks but and the S&P had kept up with it right but you’ll notice last week uh you know um you know the S&P peaked the week before I believe it was the uh Friday after Thanksgiving I think is right and uh been kind of on the on the way to drift lower here since but even more noticeably here’s your nysse right having peaked as you can see what we got about two weeks ago a little over two weeks ago there’s your Russell as far as inaday I think it’s Inay and close right there that was three weeks ago so a little over two weeks almost three this has been three so this explains this reminds me a lot of what was going on in 2021 not that it has to play out the same but uh the Dow was able to notch a new closing on here but at the end of the day you’ll notice it really didn’t move any higher okay it’s kind of been stuck now for the same three weeks and look at the last week and a half okay down every day right so um so actually the markets have been moving lower not higher um we’ve been getting carried by a lot of tech uh last week when I looked at leading sectors it wasn’t tech tech was actually in the red last week um it was discretionary and services which a lot of times we consider those to be tech stocks but um but yeah this is the only thing really moving higher so every everybody else is moving lower and that expl exp why we’re seeing um you know decliners outpace advancers and so kind of you know makes you wonder this you know we’re getting into a period of time where we’d expect more and more bullishness at least going into to the beginning of the year and so it does kind of make you uh wonder how much juice we’re going to have in us um if the reality is the Market’s not moving higher but that being said you know uh when we look at the NASDAQ here I wouldn’t say it’s a great close or anything but um it just looks like more par for the course so for now again as it pertains to the the NASDAQ here as you can see up and S&P futures up so we’ll see if we can rally into the end of the month and turn things around here a little bit um I do think uh I was discussing this this morning um you know we start talking about the new year and and last week I was mentioning that I have to admit I personally I’m a little cautious on the first part of next year uh whether it be first quarter first half of the year um with the markets continuing to kind of Notch these new highs one way or the other I think we’ve lost a little sight of the fact that remember you know easing Cycles you know once we start cutting rates that there tends to be a clock ticket um on a in a market decline all right um same thing with uh when’s the last time anybody was talking about you know the threes and tens in the inverted yield curve right it’s been inverted I believe I read last week or something it’s the longest inversion in history and a lot of the bobbleheads don’t know what that does and does not mean um as far as you know how it is played out in the market what typically happens if and when there is a decline recession what not it tends to happen after the reinversion which uh hasn’t happened yet but um the threes and tens are on the C cus of so when you look at those bigger picture items that I think have uh we’ve lost sight of and a market that seems awfully stretched uh we see momentum kind of starting to WAN here a little bit it does make you wonder what are we going to be looking at the first quarter of next year you know uh we haven’t had a you know a correction and by that I mean something greater than the 10% in this entire run right so we come back at least as we look at the S&P okay look at this entire run we basically hit that 10% Mark twice okay this you could say we just barely breached it but I mean like hey 15 17 20 22% we haven’t had like that real it’s like we stop right at the 10% Mark and that’s all she wrote right and so we’ve went over two years since the S&P bottomed here uh without a real type of Correction or even a mini bear so you kind of put all these things lined up and just this bigger picture if you pan out I I guess I’m a little uh I guess cautious right a little nervous about maybe what the beginning of the year that first quarter or first six months of the year what it might look like um so you know for what it’s worth that’s kind of my view on that bigger picture and what we look at I don’t think it’s realistic to think we make it through next another year without a real correction right and so by that I mean you know what one that feels like the bull Market’s over type thing so 15 20% remember when we came out of the uh 20078 9 bull oh I’m sorry bear when we came out of that one and we had a couple 20 some odd percenters or at least I think one right so let’s go back and take a look here let’s go way back hard believe let get us far enough I think it does yeah so right through here right uh what do we have here we peaked up somewhere around 12 and some change can you believe that 1,200 and we hit a low in the area right so this was a I think this was short of 20% but it was close right this one if I remember was 23% okay and we did that within the first two years two Corrections well south of or North you could say of 10% and then by the time we got another one right that was way over here this one I think was 16 or 17% something and then we got this 20er all right so from that bottom I so you know Grant this is a long time there’s the covid and then the gem you’ll notice that started right at 2022 you know the start of 2022 and in the grand scheme of things it’s just a little mini bear within a bigger bull right didn’t really end any type of thing and then now here we are um seemingly do and look how we’re kind of almost kind of coiling up in a u you could say a uh you know Rising bare wedge type of fashion I don’t really have anything like that Mark you can kind of get the idea right just tightening coil so you know are we calling some sort of a meaningful peak in the first quarter of next year no no I think you know uh I haven’t seen anything that I need to see from the technical standpoint that we look at right I like larger momentum divergences we’re not really seeing those so um so I haven’t seen anything like that that’s the only time I’ve ever made calls like that is when I see meaningful divergences those have been the most reliable things for me and then preferably some sort of price that goes with it so if you go back you know to the bare Market that we it was relatively easy to call using those metrics it wasn’t too terribly challenging here we had a monthly momentum Divergence took place as we went to this peak and price confirmed that if that’s going to play out when we broke out of the bottom of this channel right and the monthly Divergence it’s right here it’s just you can’t see it because it’s on the daily because we’re currently on the daily but you pan out you’ll see it all right so see right here that’s the way we were able to call that correction that’s how we’re able to call this correction it’s how we able to call I know none of you were probably around back here but it’s how we able to call this this one now the extent of the correction is obviously much much harder to say okay but what we know is and if you go back to 2000 what you can’t see here the market is now five and0 since the turn of the century when you see one of these momentum divergences pop up get ready something’s coming now it might only be whatever this was 6 177% right it might be 20% like this one might be 30% like that one the last these previous two they were 50 percenters but what we know is pretty reliable right which was what we’d expect this is large scale takes a lot of data over a long period of time to put this thing in so not only will it tend to be more reliable right we don’t see them very often when they form they will tend to be more reliable and obviously there’s bigger implication so as you can see there’s nothing like that yet that we would uh see when we look we look at it from time to time but and imagine what would have to happen though a lot of time will have to pass we would have to fall first run back up to new highs and then have that next Peak KN so that that would you know we would need something going into next quarter next half year to put in a monthly Divergence do keep in mind we don’t need a monthly type of Divergence to drop so just to be clear on that front there was no diver this is the NASDAQ right but there was no Divergence here didn’t stop it from falling right so so we shall see we’ll see if uh we get something like that that uh but as of right now there’s nothing like that that is popping up so you know that’s my view going into the year ultimately what we do is we kind of trade we’re short sh term so that’s why we don’t really talk about that bigger picture as much because we’re not super you know concerned with that big picture um when we know we’re in the bull or we know we’re in you know certainly we want to have some sort of larger scale what do we think the overall move is for sure but whether or not we’re you know um you know in a in a long-term bull long-term bear doesn’t have near as much effect on our trading as as much as just trying to get that you know uh uh shorter term hey what are we what are we doing this week type of thing what are we doing going into next week but yeah In fairness sure we we want we we look at that within context of what the bigger move is for sure so all right so that’s kind of the market uh any questions on any of that there how many people on this call think that um we make it past the first six months of next year with a correction by that I mean a technical 10 to 20% or more how many think we make it through that first six months keeping in mind that means we will have went nearly three years without that correction oh Tom does okay yeah I don’t I don’t know if there’s any case to be made for it I think there we’ve just made a great case for they’re not not making it through but I guess I would love to know what you think the case is for it and before you say anything things that are different than what’s going on now of course going on right now we’re talking about forecasting forward and definitely if there’s a case for it like what would be the case and I don’t I don’t really care about fun fundamentals are dumb right I don’t that does that’s not a case right so don’t give me fundamentals remember beginning of 2022 based on the fundamentals the top 10 investment banks on this planet called for the market to move higher in 2022 okay so fundamentals aren’t a reason for what is going to remember markets are going to move higher and fundamentals are always good at the peak I kind of like Royce’s answer Collins but the question was how many of you think it so nobody’s none of us are here trying to call it for fact right Stefon how you doing man I don’t see you around as much as we used to it’s good to see that’s true Barry but remember I don’t know that the market cares okay people it’s unfortunate that people think presidents matter as much as they do because they really don’t matter at all I’m I’m talking about for Trend we all remember the Trump tweets I’m not saying stuff like that I’m talking about overall Trends I don’t know that there’s any real case to be made the market cares all that much but but yeah I mean I haven’t I haven’t seen anything uh that leads me to believe there’s a great bull case other than the fact that hey it’s what we’re currently doing right but so you know we’re always doing that until we correct and that’s another thing too I mean when you look at historic average you get a correction about once every one and a half years so we’re again we’re approaching two and a half years so I think that uh uh tariffs seem to matter ah they do and don’t Allan you know I you know I I I’ll give you a 50/50 on that remember there were tariffs the first time around right and the market rallied well I guess depends what people are going to blame the co crash is a tough one but remember first time Trump was in office he was slapping tariffs all over the countryside didn’t sto the Market’s Trend though and it didn’t ever induce a correction right so remember we’re not talking about just like a one day 2% drop or something I’m talking about a correction and no Trump tweet no tariff ever caused one and this time we even kind of know it we’re much more prepared so I would say that’s less of a concern than it was the first time around and I always encourage everybody to remember this when Corrections hit if it was you know I would say as a general statement from a fundamental news type standpoint no one ever sees it coming no no one ever sees it coming when it happens now we could do the Michael bur right where we we know it’s coming eventually what he wasn’t he like two years ahead wasn’t he shorten things like two years before you know or something so he eventually got it right but like when it happens it’s like oh we’re down 12% already but I could see the reason why I’m saying I I could see a to Allen’s Point certainly we could see we start getting in a trade war of some kind I don’t know that the market would be too terribly thrilled about that but yeah so don’t get me wrong I’m not saying these things quote don’t matter but when you’re talking about Trends I think the Market’s already proven that they don’t and this time we know it going in so I I don’t know that I would say that would be a reason to think about a correction I think my opinion is markets just simply correct when they do and usually there isn’t a reason now we slap the reason on it after the fact or at least I’m rephrase that the reason isn’t Apparent at the time we start to correct so take for example 2007 89 bare Market it’s a great example now we all look back and we say it’s this reason that reason or that but remember at that time the investment Banks were kind of lying to us according to the FED we weren’t in we weren’t heeden see banki didn’t see us going into recession even though we now know that we were already in one when he said it right so which is incredible by the way but neither here nor there I would just say that I think odds are I think that um I think if you look at everything and remember what’s happening in reality and the market are two different things okay so what the Market’s doing now typically has nothing to do with what’s going out in the real world now right markets are forward looking right so when the markets decide they’re going to take a crap it’s going to be on stuff that’s maybe being looked at in the future but I think when we look at history again when you look at um I think Market’s been pretty good once you see easing Cycles you’re on the clock and we started when was the first rate cut was that last fomc or two fomc’s ago regardless what we’re at least a month or two three months into it 30s and tens are getting ready to reinert that typically triggers signals of recession markets are ahead of it September Kevin thank you so yeah couple months back so Mark’s been pretty good about it pretty good about it so I think that’s a great case doesn’t mean it will happen obviously uh GW I don’t know what that would have to do with anything I mean if they have success I would think that increases the odds right remember Cuts Cuts cuts and more cuts and cuts and cuts that’s jobs that’s the economy if they don’t accomplish anything then it’s part for the course and why would it change anything but I would say just always remember markets they don’t ring a bell at tops but we will find out but I would say you know I’d be willing to take Wagers I guess I’ll put it that way I’d be willing to place this fun bets that we do get a correction in the first six months of next year so but we’ll see markets do what they do right all right let’s look at some stuff and some things uh Tesla’s never going down again so that’s good great close by Tesla last week although if you notice each one of it great closes are have not been followed by necessarily great next days but apparently this one’s never going down forever so I don’t think I’d be chasing it up here I think I just kind of just sit and wait you can get a better spot obviously as many of you know we kind of play Both Sides so there’s always that but we looked at that last week and the premiums are just pricey so but you know up a few more dollars in the pre-market nothing special NASDAQ is up in the pre-market markets are up in the pre Futures are up there so uh so we like that we obviously put a trade on in Lulu I kind of like the turnaround here I really wasn’t thinking that this was going to be a level that really came into play but it’s one that has mattered in the past and sure enough I guess it matters still right right around 385 is so I kind of like uh Lulu at least for now kind of resume obviously a lot of talk about broadcom so I don’t know how you play something like that I I don’t know that anybody can sit there and say that thing’s going higher or lower um I think of course you have to air on the side of higher Market moving higher at least as it pertains to NASDAQ Tech that type of thing so I think you’re definitely airing on higher but uh we had talked about possibly I don’t I think we I say we even looked at the premiums on this for like a 210 230 strangle for it to break one way or the other yeah look at that oh go the wrong way there we go say wow yeah we looked at no wa minut no we talking about this so This call side is gonna be much more expensive so I don’t think I would do that I might go here instead man I kind of like that for a trade to start the day you know wait a little bit after the Market opens but something like the 240 210 so basically what you’re doing here you’re throwing a stop underneath this high this low is what you’re doing and then you’re saying hey I’m going long for an upside move so I might actually be willing to pay extra for the 230 to be waited to the upside but then you’ve got your stop here in case you take out that low so I kind of like looking definitely the 210 on the put side up here I’d have to see I wouldn’t mind mind waiting out the open to see if we can get a little dip a little pullback a little something get a little premium for the weekend sucked out of there and see if we wouldn’t mind getting something 235 230 but if you look at the at the monies here right now you’re currently around $6 right so you want to keep that in mind you’re going to spend a dollar over here and then I would love to and I don’t hate the 240s but again up call so they want to keep that on the watch list uh NDB looks terrible so we put that trade on as well more of a hedge to our uh to our Long play on Lulu but looked like we were trying to pump the breaks here on Thursday and Friday instead just so I’m kind of watching I don’t know if this 240 it’s 240 I mean we had this but we also had earnings around here prior to this you can see this 240 was a meaningful level both support and resistance underneath so I was kind of thinking we want to get here here but 260 you can see a lot of stuff going on in there 250 is a number right right there in the middle so but uh it’s not flattening pretty much got nothing going on what else we looking at uh app was moving last week kind of picked up the steam picked up the pace a little bit again although didn’t do a whole lot didn’t do as much as we needed on the uh on the Thursday and Friday still holding this low we thought this was a meaningful low being put in so it’s still holding that but I guess a little surprised it didn’t follow through it all so might not uh hold up after all um who else will be eyeballing last week andd looks a little sketchy to me kind of see there’s a pretty good trend line that had gotten broken so that looks speaking of looking a little sketchy nvidia’s potential Head and Shoulders here shoulder head shoulder so I’ll be watching this Zone Nvidia takes that out I’d be thinking probably here take that out and you could find yourself in some more trouble okay [Music] uh what stock was that in on audio only uh shoot you remember the prices I referenced now you’re in Prime Time Eric so we already have two of them were Lulu and MDB so we’ve already got those and then I was talking if you’re talking about the one I was talking about strangling it was broadcom avgo the low was basically in the 210 area just above 210 so I know I’d want a put side to be under that now it’s jumping $7 right here at the open so I that might change things um I was kind of hoping maybe we get a pullback first to get a little less expensive calls side play but again the 230s are out of the question which is what we were looking at so now you’re definitely looking at at least 240s 240s are going to run you at least three and a half bucks and probably not interested in the 210s now I’d be looking maybe more like 215 so that total puts you in the $4 range but um I’m also okay just you know ignoring it yeah that was it that was broom but now it’s kind of it also depends too like you know how how how much of an exchange for higher probability are you willing to give for lower profit right if you really want to get tight on this thing 240 230 is going to cost you8 so as long as you clear 248 or you drop below 222 you know you’re making money but there’s a higher probability of that happening than say getting to 280 or something um at the in the in the uh the close this thing go down at 225 so the Dynamics of it are changing here now up $10 so I don’t mind I personally don’t mind waiting this thing out if I was going to get in now I might go 245 225 for five bucks and then see where it takes us remember we got fomc this week so should get a little bit of good times there all right Market’s open for business I know people want to get out there and do some trading so I will let you run there will be a marketcast call next week it’s the only call I’ll be doing next week but there won’t be one the following week so just an FYI on that front so I think that’s the 30th I believe so we will be here next week right otherwise everybody good luck in the trading have a good one