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- Alpha Report Issue #43
Alpha Report Issue #43
The FED Might Break The Stock Market
Brandon
January 08, 2025
Welcome to The Alpha Report 👋
Hey guys!
I will be sending out my Alpha Report for FREE every day the market is open! I always want to create more value for you guys and this report is only going to get better! Enjoy!
-Brandon
Today’s Heat Map👇
Market was pretty much flat today. We dipped mid day and clawed it all back as investors were bracing for the fed minutes that dropped today. I break this down below!
Fear & Greed Index For Today👇
36 Yesterday & 32 Today.
Stocks were pretty much flat today as the market digests the benign fed minutes.
I feel that we are closer to 55 vs what this says.
Always keep your emotions in check on pumps & dumps.
Short term market movements are usually irrelevant.
Volatility is opportunity.
Be greedy when others are fearful.
Be fearful when others are greedy.
I think the market is a little lofty and if we pull back 10%, I view that as a healthy correction.
We came a long way the last 5 years and it is ok to give a little back.
This is why it is KEY to not be over leveraged at times like this.
Be prepared to capitalize on upside and… x.com/i/web/status/1…
— Investing With Brandon (@Invest_Brandon)
9:00 AM • Jan 8, 2025
Today’s Economic Updates👇
30 year fixed mortgage rate climbs to 7.23% today vs 7.22% yesterday.
10 year treasury bond yield climbs to 4.69% today, vs 4.68% yesterday.
2 year treasury bond yield climbs to 4.29% today, vs 4.28% yesterday.
Fed minutes were released today which basically gives more details into what was talked about at the last fed meeting in Dec 2024.
I break this down in the next section!
The Fed… Make or Break👇
So the Minutes from the feds meeting in December 2024 just got released today.
The Fed decided to reduce the federal funds target range by 0.25 percentage points, setting it at 4.25% to 4.5%.
This was the third consecutive rate cut which was aimed at supporting economic growth amid persistent inflation concerns.
We had sooo much progress in the last few years on inflation.
We came down from over 9%, to now in the upper 2% range… so we are close to the target!
We are currently at 2.7% now.
Fed members noted that inflation remained above the Committee’s 2% target, with recent readings higher than anticipated.
Things are getting a little sticky around the upper 2% range.
The fed committee also said that economic activity continued to expand at a solid pace, with labor market conditions easing and the unemployment rate moving up slightly but remaining low.
So this is just things coming into a healthy balance!
This is good for lowering inflation, but we don’t want too much weakness here that throws us into recession.
The fed has a lot of ammo of rate cuts they could do at a moments notice to help respark the economy should we be in a recessionary environment. (Cutting rates from current levels to ZERO)
This is a chart of the fed funds rate since 1955. Even though we did raise quite a bit in recent years, we are still historically on the low side of average.
Given the economic conditions, the fed signaled a more gradual approach to future rate reductions, projecting only two additional cuts in 2025, compared to earlier expectations of four.
This cautious stance reflects concerns about inflation and the potential impact of incoming policies from the Trump administration.
Following the meeting (which happened a few weeks ago), markets nose dived and bond yields pumped.
Remember! Rates are gravity.
If yields go up, that puts pressure on stocks!
So really not much new info from this report vs when we had the press conference from Jerome Powell last month.
So What Do We Do With This Info?👇
I am in the camp the market is a little lofty.
On top of that, rates are projected to be higher for longer.
So at a time the market is a little lofty, and rates are expected to be higher, that can be trouble for the markets.
So for the fed meeting December 20, 2025, rates are projected to be at 4% - 4.25% as the most likely scenario. This is implying 1 cut of 25bps
I feel the inflation concerns are being blown out of proportion and as time goes on inflation will continue to trend lower.
Rates will slowly get cut to go down with it.
I project a total of 75bps of cuts in 2025, which will be good for the stock market as long as we have a strong economy.
Time will tell!
So I think we have 1 main negative (valuations) and 1 main positive (market pricing in less cuts vs what I think will actually happen)
That sets us up for a potential stock market surprise repricing of more rate cuts which will pump the markets, but valuations are a concern.
Expect volatility.
Do not be over leveraged.
Final Comments On Today👇
Do not make plays to make plays.
ONLY make high margin of safety plays.
Do not buy something just cause the share price is going up
Continue to DCA into quality stocks/ETFs at good prices.
When you find undervalued companies, use options to magnify gains
Check out my links below for my course, free guides, & intrinsic value calculator!
👇Price Targets For End Of Year 2025
(updated daily)
QQQ - $565
VOO - $575
IWM - $240
SOXX - $240
TSLA - $400
NVDA - $190
AAPL - $250
PLTR - $60
AMZN - $245
GOOG - $205
MSFT - $460
JPM - $260
👇Price Targets For End Of Year 2030
QQQ - $750
VOO - $800
SOXX - $400
TSLA - $1,200
NVDA - $650
AAPL - $375
AMZN - $450
MSFT - $850
(of course a lot of these will split, but this is non split adjusted)
👇My Favorite New Trades 👇
I either plan to enter, or have already entered these trades.
These are in order from least risky to most risky!
VOO - DCA Shares - 3 year min hold duration
QQQ - DCA Shares - 3 year min hold duration
SOXX - DCA Shares - 3 year min hold duration
TSLA - DCA Shares - 5 year min hold duration
NVDA - DCA Shares - 3 year min hold duration
AMZN - DCA Shares - 3 year min hold duration
NVDA - Sell Puts - 1 year duration -Strike of $120
SOXX - Sell Puts - 2 Year Duration - Strike $180
GOOG - Sell Puts - 1 year duration - Strike $160
TSLA - Sell Calls - 1 week duration - Strike $450
PLTR- Sell Calls - 2 week duration - Strike Price $90
MSTR - Sell calls - 1 week duration - Strike $95 OTM
(Join premium discord to see my exact trades in real time, ONLY FOR COURSE MEMBERS)
👇Current Value of My Trading Account👇
(updated daily)
👇Yearly Account Account Value
December 2018 - $0
December 2019 - $45,251
December 2020 - $150,191
December 2021 - $267,524
December 2022- $290,315
December 2023 - $506,223
December 2024 - $927,796
IN PROGRESS 2025 - $947,891
👇Portfolio Thoughts
Amazing growth from 2018 to Current all off of a total contribution of $90,000.
That is over a 10x in 7 years!
I did this in a very low risk and conservative way.
The key is to educate yourself how the market ACTUALLY works and use it to your advantage!
Do my course, It will change your life! (link below for 60% off)
I did touch a million in this account a few weeks ago but we pulled back a little.
I feel the market got a little stretched and this pull back is healthy.
I will continue to find great investments/ options plays that will pan out to explode the portfolio in the long run.
Month to month and even year to year volatility is irrelevant. I see volatility as opportunity!
My goal is $5,000,000 in this account by 2030.
I see this as very achievable and if the market dips further, I will capitalize heavily, just like I did in 2022!
Stay the course and keep your emotions in check!
I started this account with $0 in 2018 & Currently $947,891. Total contributions of $90,000. This is the power of doing stocks and options the right way, but I do expect more volatility. I am being very cautious with options right now. I consider this account to be worth around $750k for the true intrinsic value, not $900k+. This means I wouldn’t be surprised if we take a dip!
👇How My Trades Have Performed Since 2023👇
Blue = Me, Black = Nasdaq, Orange = SP500