Joel Elconin - Market Momentum Has Been Lost… Is The Bull Run Over?

Hi, everyone. Welcome to the K E world port in a daily editorial on Thursday, March 5th.

I'm chatting with Joel Alconon.

Joel is the co host of the pre market prep show and also founder of the stock trader network.

I'll post both links in the show notes so you can follow along with Joel and his partners.

Joel, let's start big picture of these markets.

To me, it just seems like there's been a complete loss of momentum this year.

You pull up the daily chart for the S&P, the Dow.

Really, any major average in the US and it's choppy to say the least,

but almost seems like a gradual top.

I know it's dangerous calling tops in these markets because the markets just seem to have a propensity to melt higher.

But Joel, this year, I don't know, it just feels different and quite frankly,

it just feels like investors aren't as excited anymore.

And well, let's face it, there's a lot of geopolitics going on that I'm sure push them away from markets.

But am I off on saying that momentum's lost in the US markets?

Ah, good afternoon, Corey.

Thanks for having me.

Oh, boy, I don't want to get too riled up too early in the interview here.

But the spark is in trouble and there's a lot of different perspectives,

time perspectives and catalysts that you could, that you could look at.

But wars in my playbook are not that good.

And if you look at, I mean, besides the human loss that goes on,

the geopolitical situation couldn't be worse right now.

And if you think that, you know, oil ripping like this is going to be good for inflation, you're wrong.

If you think that all these job layoffs are coming or down the line,

more announced today or good, you're wrong.

The AI bubble of AI efficiency.

I mean, that's taking away not only blue collar jobs,

but it's going to take away white collar jobs.

So just cannot find too many positives in this market right now.

So Joel, is there anywhere to hide though?

It just seems interesting.

You and I were talking off mic about the news out today from Berkshire that talks about the new CEO.

He's putting whatever his wages, multi million dollar, tens of millions of dollars back into the company and the company.

Berkshire is out there buying back their own stock.

It doesn't seem like they're out there buying anything else.

Is that just a sign of this market?

What does that tell you?

400 billion dollars in cash.

Right for looking for acquisitions, looking for value, not only that.

Not only are they using the cash to buy their own stock, you know what they're doing, they're selling stock.

I mean, if you've seen imbalances or look at the 13 apps, they've been selling their bank.

There's been a huge seller on the open and bank of America for the last three weeks.

Do I know it's Warren Buffett?

No, do I know that he's been selling and decreasing his holdings?

Yes, so they're not really buying some stuff, Google, New York Times, certain things like that, but they're selling stock.

They're accumulating more cash and the cash that they're using, they're only using to buy their own stock.

If that's not symptomatic of the market environment that we're in, I don't know what could be any clear.

So I guess to that point, what about safety?

When we've seen some intrepidation by investors in the past, they've actually flown into some of these big tech stocks

because of the cash that they have and the cash that they're able to generate from their high margin business.

Are we going to see that again?

Could that actually help these tech stocks that are getting hit on this whole AI bubble narrative?

More or less, the AI bubble narrative popping could big tech actually turn out to be a winner if everyone's worried?

No, no, no.

There's a couple of reasons.

Well, first, I'll give you what was everybody looking toward?

Like what was going to be the big catalyst to take this market over 7,000?

Do you remember?

Last week.

Ray Scott, someone was looking for Ray Scott.

You could throw that out the window right now.

No, in India, in India.

Yeah, which actually a good earnings, too.

Break it out over 194 to the moon, Alice.

And that completely was a false breakout.

Brought the market down with it.

Now it's trading at 182.

Now Trump wants to have more control over their chip sales.

So there's your belt, you know, that the leader of this bull market coming with the earnings beat

and ended up going lower.

So if you're not, you know, if you're not looking at the best of breed there,

in India, that was a video crash and in burning and never going to go back to all time.

Hi, no, I'm not saying that.

What I'm saying is that you keep developing expectations for stocks and they don't mean them.

If you want to look at something that's already taken to haircut and is actually holding

up fairly well today, software.

Yes, I said it software, Microsoft for bucks today.

Of course, it's down from 45550 to 380.

So perhaps this whole service now is having a good day.

So sales force.

So perhaps this like, we don't need software anymore.

Because of AI, maybe that trade is, you know, if you feel that you're looking out

longer term, and personally, I'm underwater in Oracle.

So don't follow me.

But yeah, I've already averaged down once in a small position.

But, you know, is it the end of the world?

They're laying off jobs here today.

They're laying off people too.

So yeah, I don't think I don't think it's going to be big tech.

And one thing that sticks out in my mind is did you look at the concentration

of the top components of the S&P?

And I've been around the markets for a long time.

When I seriously started following the top components in the S&P,

it was GE.

It was Exxon mobile.

It was IBM.

At one point, post Chevron and Exxon mobile were in it.

Okay.

Now you've got all these tech stocks.

It did Nvidia, Apple, Microsoft, Google, Amazon, Meta and Tesla.

Are your top components?

There is a change of the card going on here, right?

Where there's a rotation.

But how long is it going to take to replace?

I'm not saying they're going to get replaced because they're so behemous in the market.

But the kind of rotation that you're having going on right now,

I mean, you got some heaviness on the front end.

And I think that what you're seeing with the other 493,

you know, they can only, you know, they can only do the big things up so much.

But if they're selling the other seven to go into the 493,

this is the kind of action that you're going to see in the market.

As far, you know, Amazon is showing a little green today, Exxon mobile.

I think you should be trading higher, you know, with the news, with the oil.

But that's what you have.

That's the conditions that you have in the market right now.

Well, that rotation trade is something we always talk about because there's always

some rotation going on in the markets.

But we've also had somebody on the show recently that looks at the equal weight S&P.

And that recently was just at all time highs on Monday.

It reached all time highs and that started rolling over.

Do you ever look at that equal weight or what's your takeaway?

Yeah, I do. I look at the RSP and that hit a new all time high earlier today.

I mean, you know, it's equal weighted.

It makes you feel a little bit better.

But if they start selling everything, they sell everything.

And that's going to come down with it too.

But it's interesting to see the performance of that versus the performance of the spy.

So if you're looking for that out performance, you know, that perhaps that's the best,

best way to hide.

Okay, now you've mentioned oil a couple of times.

Look, we all know what's going on in the Middle East and the oil price is moving higher.

Gas prices are moving higher.

I hold a number of oil stocks.

I've been rotating into oil stocks for the last probably six months now.

They're doing well, but they're not having the same sort of move that just the oil prices.

Now again, this is all geopolitics and we don't know how long that war is going to last,

but are there opportunities in oil stocks with this war?

Who knows how long it's going to go on for?

Man, I mean, you know, for me with a USO up six bucks and, you know,

X out mobile, you know, barely up on the day.

Look at that, that high, that old time high, that it, that it made what it to be getting

out of the week.

I mean, that, I mean, that kind of looks like a blow off top.

But, man, who knows?

Who knows what?

I mean, Trump just is replacing Chrissy Nome as a homeland security.

Oh, so there's another person out at the administration.

Man, I don't know.

I mean, where goes over, you know, the over is immediately.

Then I don't think I want to be in these stocks.

The world's dependence on oil has been not decreasing over the years.

You know, what's going on with the, you know, it's Venezuela.

When that's going to, when that's going to come online.

Actually, I'm a little disappointed by the performance today.

But, you know, that's vis-a-vis crude oil prices in the USO.

But, you know, selling into a strong, I would look at that action from Monday and say,

boy, I sure hope it gets back up there soon or else, could be at a little bit of an

overbought condition.

I mean, Exxon mobile, beginning of the year, starting at 120, going to 160.

I mean, I don't know what, I don't know what your expectations when you either, you know,

stocks with long-term projections, but that's one hell of a move.

Joe, what about gold in this environment, though?

Because gold is off of its highs.

It's still up this year, about 20 something percent.

So, it's done very well, and we all know how well it did over the last couple of years.

But, we're in a war.

There's a lot of geopolitics.

What, the US has gone into three different countries.

Just this year, and we're only two months through.

There has to be some sort of geopolitical premium in the gold price,

but is gold further going to be a safety play as the world continues to

more or less fight with the US, and it seems like fight with each other?

Yeah, I mean, you know, I was cautious, I was cautious after that blowoff top.

I thought, I thought to you and shout about it.

And to me, you know, when I, you know, I'm just looking at DSLV that just got ridiculous,

you know, over when it got to nearly 110, pull back under seven days.

I mean, you had the retracement of the move in both gold and silver, and they came up significantly,

silver came up significantly shy of that of the of the moves.

So, yeah, there could be a, you know, it could be a flight quality, but, you know, you can't,

you know, you can't eat gold.

So, you know, I mean, it's a store of wealth, it's supposed to be, you know,

fitting well into this scenario, but to me, the, you know, the price that, that, like,

those really look like blowoff tops to me, and you got to remember, you know, before,

you know, silver had this move and gold had this move.

They had years and years and years of consolidation and choppy trading.

So, I'd be more prepared for something to ragebound trading and gold and silver

than I would for it to be coming totally unravel.

They're just ripping back to all time highs.

Okay, final area, international markets.

Last year, international markets outperform the US.

The US was a big underperformer.

And then I get the argument that the US markets did so well the last couple of years.

Before last year that it was due to underperform the international markets, but

we're in the second year now where it very much seems like international markets are still,

looked at more bullishly than the US, especially when you take into account just how much

the dollar dropped last year.

Do you see opportunities in international markets?

Opportunities to sell.

I mean, I, you know, I just look at it, the rent it like the EFA and the EEM had.

I mean, is this a dip?

I mean, the EEM was 38 bucks in the middle of about

April 2025.

You hit $66 last week and now you're at 57.

I mean, if this contingent continues, I don't take your safe in Europe.

I don't take your safe in US.

I don't take your safe anywhere.

So no, I'd be more inclined to be taking profits and something like that.

But as far as looking at this move and the EEM here as a dip,

I mean, they got their own problems and now more problems are being created.

All right, Joel.

I guess the big takeaway being watch out.

Don't be buying very much right now or anything at all because momentum seems lost.

And yeah, it might be a good time to take some profits and write out whatever the world looks like

in the next few months and wherever these markets settle at.

But hey, it's always enjoyable chatting with you.

Even if it is a bit more on the negative front, but I've been feeling that way with

these markets too and just the general loss of momentum and the craziness we keep hearing

out of the White House and really around the world.

It's kind of a scary world right now and markets definitely are paused.

Let's just put it that way.

Joel, as always, thanks for your time and everyone listening.

You want to follow along with Joel.

Click those links in these show notes or simply search pre-market prep or stock trader network.

Thanks for your time, Joel. Have a great rest of your week.

Okay. Thank you, Corey.