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- Alpha Report Issue #81
Alpha Report Issue #81
Current State of The Stock Market.
Brandon
May 18, 2025
Hey guys!
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-Brandon
Fear & Greed Index👇
Current read is 71 on the fear greed index vs 62 last week.
Market Fearful = Potential Opportunity/Deals. (buy calls/sell puts)
Market Greedy = Potential Over Valuation. (buy puts/sell calls)
So the market is now in the greedy category (almost extreme greed) after a massive bounce off of the April lows.
Remember, I like to be bullish when there is extreme fear & bearish when extreme greed.
So right now, I am kinda neutral & that is ok!
Opportunity will come. BE PATIENT!
Current Fear/Greed index.
Historical Fear Greed Index In Chart Form.
Current Interest Rates👇
30 year fixed mortgage rate flat at 6.96% Today vs 6.96% last Sunday.
10 year treasury bond yield climbs to 4.44% Today, vs 4.38% last Sunday.
2 year treasury bond yield climbs to 3.99% Today, vs 3.88% last Sunday.
Interest rates increased this week, which is kinda bad for the stock market usually….
As interest rates rise, stocks become less attractive because bonds become more attractive.
Also, stocks rose which also makes them less attractive cause things are more expensive.
REMEMBER, MONEY ALWAYS WANTS TO FIND THE BEST RISK ADJUSTED RETURN.
Bonds are becoming more attractive…
Overall, this is not good for stocks & the economy, but I do expect rates to fall in the coming quarters as inflation continues to cool which will slowly make bonds less attractive.
The State of The Stock Market Right Now👇
Think about the progress we made in the stock market since the April lows… We had an insane recovery! The Nasdaq is now up over 25% off the lows for the year and the S&P500 is up over 19% off the lows… So everyone here wants to make money… So lets look at the info that matters then form a thesis on what we will do in the market right now.
US Credit Downgrade👇
Moodys downgraded the US credit rating to Aa1 from AAA.
Largely due to the national debt.
Is this justified? Kinda.
Moodys Just Took USA From Aaa to Aa1.
The U.S. has had its credit rating downgraded twice in history by major rating agencies.
Here’s a quick breakdown of both instances and how the stock market reacted the next day:
1. S&P Downgrade — August 5, 2011
Downgrade: From AAA to AA+
Reason: Concerns over U.S. debt levels.
Market Reaction the Next Day S&P 500: -6.66% & Nasdaq: -6.90%
2. Fitch Downgrade — August 1, 2023
Downgrade: From AAA to AA+
Reason: Expected fiscal deterioration, growing government debt burden.
Market Reaction the Next Day: •S&P 500: -1.38% & Nasdaq: -2.17%
Market sold off moderately but not as intense as 2011, likely because it wasn’t the first downgrade and markets were better prepared.
Translation:
Yes, we don’t wanna see a downgrade, but I don’t think it’s a big needle mover. America works and hopefully this just lights a fire under the butts of congress to try even harder to get back to budget neutral…
✅Stamping this section: NEUTRAL for stocks right now.
The Tariff Threat👇
A lot can change in a week… especially with tariffs.
Here’s what happened:
Trump’s team formally confirmed they’re in active negotiations with China, Vietnam, and India.
UK and EU deals are essentially wrapped up as final details are getting polished.
The 90 day pause on additional tariffs is still holding, and there’s now talk of extending it if progress continues.
China just signaled over the weekend they’re open to restructuring key parts of their trade posture — that's a major shift.
In short, the tone has gone from “we’ll see” to “we’re getting close.”
If even one big deal gets inked, markets might will rip.
But again, valuations are a little lofty… (more on that coming)
Translation:
Trade deals are bullish, but the market is still a little expensive. If earnings don’t rise fast enough to justify these valuations, there’s downside risk.
✅ Stamping this section: CAUTIOUSLY BULLISH for stocks right now.
Earnings Season Wraps Up👇
We’re now mostly through Q1 2025 earnings — and here’s the truth:
It was a LOT better than expected.Here’s what I saw across 40+ earnings calls:
Revenue growth is holding up.
EPS beats outnumber misses by a wide margin.
AI related spending is still through the roof.
CEOs are cautious in their tone, but their capital expenditures say otherwise… companies are still investing in growth.
Earnings aren’t perfect, but they’re a lot stronger than the media makes it seem.
As I have said 700 times lol, earnings are the number one thing that matters for the direction of stocks in the long run.
The market is a little lofty now, so EPS and guidance gotta be good!
Translation: Earnings are big, guidance is big, growth matters, outlooks matter, AI spending matters, lots of stuff matters! The key is to take in as much information as you can and eventually you will have compelling plays that come across your desk. The more you look, the more you’ll find. This is why I do deep dives on dozens of companies every month in my Discord. Make less trades, but make bigger and better ones. This is how you win.
✅Stamping this section: BULLISH for stocks right now.
Volatility, Emotions, & Capitalization👇
When I started out a decade ago, I used to hate volatility.
Seeing red in my portfolio felt like I was lighting money on fire.
& every dip felt like the world was ending…
But here’s the truth: volatility isn’t risk… it’s actually opportunity.
Opportunity to buy great companies below intrinsic value while the herd runs for the exit.
Opportunity to sell put options at inflated premiums, while emotional investors pay top dollar for downside protection.
They’re panic buying puts.
I’m selling them the puts for juicy cash flow.
Like Buffett said: “Be greedy when others are fearful.”
When stocks hit cheap valuation levels—I’m buying.
And if the setup’s right, I’m using options to supercharge the upside.
If 20% swings scare you, the market might not be for you.
Confidence comes from knowledge.
And knowledge comes from having a proven plan.
Never stop learning. Never stop leveling up.
Translation:
Every market dip feels like the end of the world. As the typical investor panics on the dip to sell, informed investors like the ones in my Discord are capitalizing! Keep Emotions in check!
✅ Stamping this section: BULLISH for the stock market.
Market Valuation👇
Is the market cheap right now?
Nope…
Everyone talks about how we did a 20% dip, but nobody talks about the fact that things were expensive at the top and that we recovered most of that dip all at a time that EPS is not much higher to justify this valuation.
Blue line = SP500. Black = EPS of SP500.
I talk about this chart above a lot on YouTube and in Discord… BECAUSE IT’S CRITICAL!
Stock prices usually follow the EPS growth on a percent basis in the long run.
When you see the 2023 and 2024 period, you can see the SP500 price went up much faster than EPS did…
That disconnect means things got expensive.
Then we got the dip this year and the SP500 corrected back to the EPS line which was needed!
But now we rebounded 15% ish back above the EPS line which indicates slightly lofty valuation.
I am not saying it’s a bubble, I am just saying it’s a little expensive and to be careful in the short term!
The flip side to this argument is that EPS may go way up and that will justify the valuation.
Time will tell!
Be prepared to capitalize and win with upside and downside!
Translation: The market got expensive starting in the end of 2023 and got worse as 2024 progressed. This dip we got is 100% justified and was needed. Keep your pants on and don’t freak out. As the market gets more expensive, I like to reduce leverage and risk. As the market gets cheaper, I like to add leverage and add risk.
✅ Stamping this section: Slightly BEARISH for stocks.
Why This Dip Is Opportunity👇
I said it before and I’ll say it again:
We are on the front end of a productivity revolution.
In the past month alone:
Amazon announced robotic picking systems are going live in major warehouses.
Microsoft and ServiceNow revealed fully AI integrated workplace flows.
Tesla’s humanoid robot was spotted doing actual factory tasks.
Nvidia’s CEO said this is “the next Industrial Revolution.”
Think about that…
AI isn’t just hype, it’s being deployed.
Productivity up = Margins up = EPS up = Stock prices up.
There will be bubbles within AI, no doubt.
But the broad productivity tailwind is real and investable.
Translation: I think we are on the cusp of a once in a lifetime investing opportunity. I am talking one that is like getting in to the internet before it went mainstream. I am not BSing you right now. I see the tidal wave coming, and I am capitalizing. But the window will eventually close…
✅ Stamping this section: BULLISH for stocks.
Don’t Be Like The Herd👇
Buy low & sell high, right??
But how come most ppl buy at (#2) and sell at (#4)?
Shouldn’t it be the complete opposite?
Yep!
They buy into the hype(#2), get smoked (#3), then sell for a loss (#4)
Now that things are rebounding a little, they are starting to get FOMO again.
This is how most “investors” operate… Please don’t be like that.
As things get expensive, I sell.
As things get cheap, I buy and use options to get a leveraged upside return all while keeping risk low.
This is exactly how I scaled to millions and the people that did my course & are in discord are too.
The stock market is the only place on earth where people don’t want to buy when things go on sale… they actually wanna sell.
Understand intrinsic value.
Don't chase hype.
Don’t act on emotion.
Stay focused and zoom out.
Learn How To Capitalize👇
DOMINATE THE MARKET WITH STOCKS AND OPTIONS!
I will teach you EXACTLY how I scaled to MILLIONS & generate THOUSANDS monthly with stocks options all in a low risk way!
(YES, ANYONE CAN DO THIS & THE REVIEWS ON MY WEBSITE PROVE IT)
EXACTLY WHAT YOU GET: FULL ACCESS TO MY PROVEN COURSE & ACCESS TO MY MASTERMIND DISCORD.
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ECONOMIC CALENDAR FOR: MAY 19 - MAY 23, 2025
All times in PST
Monday May 19👇
Market digests US credit rating downgrade
Tuesday May 20👇
Home Depot Earnings (pre market)
Palo Alto Networks Earnings (post market)
Various fed governors speak
Wednesday May 21👇
Lowes Earnings (pre market)
Snowflake Earnings (post market)
Thursday May 22👇
530a Initial Jobless Claims
6:45a PMI data
Friday May 23👇
7a New home sales
Slower week coming up in the markets from an economic & earnings standpoint.
All good!
I will be breaking all of this down in real time in Discord!
It’s not the options contract that burns people.
It’s their horrible logic...
You can sell puts.
You can buy calls.
You can do iron condors.
You can do any strategy.But if you’re wrong about stock either going up, down, or staying flat… NONE of it matters.
Options are
— Investing With Brandon (@Invest_Brandon)
2:11 PM • May 18, 2025
👇Price Targets For End Of Year 2025
(updated every newsletter)
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👇Price Targets For End Of Year 2030
(of course a lot of these will split, this is non split adjusted)