Author: Andrew Packer

Commodities

Kitco: Gold Trades Under Pressure as Investors Digest Fed Policy Modification

Posted on by Andrew Packer

The Federal Reserve shifted its stance in December, leading to some slight market turmoil. The central bank will slow its pace of interest rate cuts in 2025, citing uncertainty. In the meantime, inflation data shows that inflation is still down overall, but remains “sticky.”

These two events should be good for gold. The metal tends to hold its purchasing power over time. And if inflation kicks higher, gold prices should move higher as well.

Instead of seeing support, however, gold prices have dropped. In the short-term, that may relate to moves in the U.S. dollar index, which tended higher.

Markets are more focused on the direction of interest rates, rather than absolute levels. A slowdown in interest rate cuts suggest that markets may be nearing a neutral level for rates soon.

If that’s the case, then other factors may be at play for gold in 2025, following its strong performance in 2024.

Changes in the economy, which could be impacted by tariffs, could see a slowdown that takes asset prices lower. Any response to that slowdown would likely be inflationary, and then push gold higher.

For now, gold remains in an overall uptrend, even if gold-related stocks have been more mixed. If signs get more bullish overall, gold stocks may be able to stage a strong rally in 2025.

 

To read the full analysis on gold’s latest moves, click here.

 

Cryptocurrencies

Swan Bitcoin: Why This Bitcoin Dip is a HUGE Buying Opportunity:

Posted on by Andrew Packer

After peaking at over $108,000, bitcoin prices pulled back to the low $90 range. That’s a drop closing in on 15%. For bitcoin, that’s hardly a significant drop. But it’s probably enough of a drop as the asset class matures that investors should consider adding to their position.

The days of bitcoin dropping by 40% or 50% overnight are likely over. There are far more buyers interested in the asset today than in the early 2010s.

Plus, it’s easier to safely buy bitcoin than ever before.

As with any asset, periodic pullbacks are a feature, not a flaw. Pullbacks cause leveraged traders to close out their positions. This resets the stage for a healthier trend higher over time.

For bitcoin specifically, the asset has had a strong year. Price-wise, bitcoin has nearly tripled off its low of the year. And it’s following a cycle trend that should cause the next peak in 2025.

Meanwhile, rising institutional adoption points to significant demand for 2025 and beyond. Bitcoin’s nature, offering a fixed total supply make it an optimal asset for wealth storage over time.

Overall, investors who use opportunities to buy assets on a pullback are rewarded when that asset rebounds to new highs. That should be the case of bitcoin for most of the next year.

 

To view the full review on bitcoin, click here.

Stock market strategies

A Wealth of Common Sense: Looking for the Next NVDA

Posted on by Andrew Packer

Investors have enjoyed a strong stock market over the past two years. The market rally started right around the time of the launch of ChatGPT in late 2022. And investments in AI turned around the bear market and brought back optimism for investors.

No company has been a better sign of that trend than Nvidia (NVDA). The graphics processing unit (GPU) manufacturer has had a long life. It’s shifted from niche gaming, to demand for cryptocurrency mining, and now AI tools.

While Nvidia can likely continue trending higher, the big returns have been made. Investors would be wise to look for the next Nvidia. That’s especially true as Nvidia’s shares have started to slow down their returns in the second half of 2024.

What should investors look for? A company with a relatively small market cap for starters. That can lead to faster growth. It’s easier to go from $10 billion to $100 billion than for Nvidia to add another $1 trillion.

Smaller companies can be more volatile and unproven. But that was the case with Nvidia when it first started to get compared to Intel (INTC).

Intel has been a poor performer as it’s been unable to successfully pivot to AI-related chips.

Finally, investors should look for American-based companies. The U.S. has the most developed technology, legal, and financial networks. Plus, geopolitical considerations remain a concern, making the U.S. ideal for tech investors today.

 

To listen to the full podcast, click here.

Stock market

Elliott Wave Options: Should You Buy this Dip? … Elliott Wave 4 Confirmed!

Posted on by Andrew Packer

Markets may have delivered a Santa Claus rally this week, but the prior week’s sharp selloff may have spooked investors. Investors were disappointed by the Federal Reserve, but then moved higher.

So what’s next for investors? Will fear come back after the holidays? Or was the recent selloff simply a function of investors shifting their expectations quickly? Looking at events now, it’s likely that markets are now ready to trend higher.

The pre-holiday selloff was likely driven by traders who were overleveraged. And as markets sold off on the news that the Fed would slow its pace of rate cuts, additional sale points were hit. The result? A cascading selloff.

Fortunately, reasonable inflation data and the quiet holiday trading season were able to stem the tide. And it’s likely that markets could continue higher into 2025.

After all, interest rates are still on track for some further declines in 2025, which remain bullish. And as long as inflation and unemployment data remain strong, markets can adapt to a slower pace of interest rate cuts.

For now, investors should expect markets to trend higher, albeit at a slower pace. Stocks may face a selloff if the Fed avoids cutting at its next meeting. But interest rates staying higher for longer also means a higher return on cash and other defensive investments.

 

For the full analysis on where markets could trend next, click here.

Economy

StockCharts TV: Larry Williams 2025 Market Outlook: The Good, Bad, and Ugly

Posted on by Andrew Packer

With the calendar flipping to 2025 this week, investors should be reflecting on what’s likely in the year ahead. Following two strong years in the stock market, particularly driven by the AI growth trend, 2025 may look different.

However, for now, the existing trend is bullish. So investors should generally stick with that bullish theme, at least into the start of 2025. Markets will start to provide some warnings about dangers, and investors will be able to sidestep significant losses.

Markets typically move in cycles. 2024 played out closely to its historic cycle for a Presidential election year. There was a strong rally to start, a pullback in the spring and summer, and a general trend higher.

So, looking to 2025, the bullish cycle still remains strong. However, investors are somewhat bearish overall. There are a mix of factors at play.

First, there’s no recession in sight, and business conditions remain strong. And while unemployment is on the rise, it’s still well under a crisis level. That could change later in 2025, and investors should watch unemployment trends carefully.

Plus, the first year of a new presidency tends to be strong for markets as well.

On the flip side, there is rising uncertainty over factors such as tariffs. While markets may fare well in 2025, more volatility is the most likely outcome.

 

To view the full forecast for 2025, click here.

 

Cryptocurrencies

Bitcoin Magazine: Will Bitcoin ETFs Surpass 1 Million BTC Before 2025?

Posted on by Andrew Packer

2024 has been a massive year for bitcoin. The start of the year saw the creation of nearly a dozen ETFs that buy and hold bitcoin on their balance sheet. That was followed by the halving in April. And many companies are starting to buy bitcoin ahead of changing accounting rules at the end of next year.

Where does this leave investors today? Looking ahead, the strong rise of bitcoin ETF assets suggests that prices have more room to head higher.

With accelerating inflows to ETFs, it’s possible that these funds could hold over 1 million bitcoin by year end. Exchanges report dwindling reserves, meaning there is less to buy.

Remember, bitcoin has a maximum supply of 21 million. Of that, several million remain lost. Today, the rise of demand via ETFs has allowed them to reach a total of 936,830.

Meanwhile, inflows to EFTs hit $6.52 billion in November, a $1 billion increase over October.

Overall, those funds bought 75,000 bitcoin. Given that bitcoin mining for the month was just 13,500, demand far exceeds what can be brought to market.

This imbalance between demand and new supply suggests far higher prices for bitcoin in 2025.

Today, 2.25 million bitcoin remain on exchanges, down from 2.6 million at the start of the year. Typically, lower exchange balances have historically also occurred at times when the price has driven higher.

 

To read the full details on bitcoin’s current supply and demand fundamentals, click here.

Stock Picks

Henry James: NVDA Is About to Rip Faces!

Posted on by Andrew Packer

Stocks often fall in and out of favor with the market all the time. Chipmaker Nvidia (NVDA) has been the market’s darling stock for the past two years on the back of AI. However, shares periodically go through a slump.

That’s been the case with shares over the past six months, which have seen nearly zero returns. The stock has dropped over 15% from its all-time high. But that kind of pullback could be a healthy sign of a future rally.

Technical analysis indicates that shares have pulled back to the $125-130 range. That’s where Nvidia has seen resistance when trending higher. Now with shares pulling back, what was once resistance is now likely to be support.

Plus, Nvidia’s recent moves are similar to moves in the past few months. Shares make a mini-head-and-shoulders pattern, moving higher, then lower, before a new rally higher.

Looking at the stock’s relative strength index, or RSI, Nvidia is nearing oversold levels. The last time shares were this oversold, they bounced from under $100 in August to $125 in September. Traders like to use tools like RSI for those kind of bounce moves.

A similar move today would send Nvidia shares back to their 52-week highs near $150.

Technical indicators suggest that Nvidia is oversold and ready to bounce higher in the final trading days of 2024.

 

To see the full analysis on Nvidia and why it’s set to rally higher, click here.

Income investing

Dividend Growth Investor: Twenty Companies Spreading Holiday Cheer to Shareholders

Posted on by Andrew Packer

Markets are ending 2024 on a strong note following substantial gains. While most investors are focused on capital gains, many companies continue to grow their dividend payouts. And total dividend payouts to investors continue to rise.

With the end of year, many companies are raising their dividends thanks to strong earnings. The list of companies with a long track record of dividend payout growth continues to rise. A full 20 companies recently raised their payouts for at least the 10th consecutive year.

That includes tech giant Broadcom (AVGO). The chipmaker has had a strong year, and recently increased their payout by 11.3%, from $0.53 to $0.59. While most investors may not think of the company as a dividend play, it’s now raised its payout for the 14th consecutive year.

And with chips still in demand for AI technologies, AVGO can also continue to offer investors large capital gains in 2025 on top of its dividend.

A higher-yielding opportunity is in Realty Income (O). Realty income raised its dividend by 0.2%, but it’s raised its payout for 30 years. Plus, shares pay monthly, which few dividend stocks do. With a current yield of 5.8%, this REIT may be ideal for investors seeking current income.

Clearly, different stocks in different sectors with different yields continue to increase their payout over time. That’s a big win for investors.

 

To view the full list of companies raising their payouts now, click here.

Economy

Rebel Capitalist: Interest Rates are Skyrocketing!! Here’s What You Need to Know

Posted on by Andrew Packer

Although the Federal Reserve has been cutting interest rates, the facts are buried beneath the headline. The Fed only sets short-term interest rates for lenders. Investors are still able to bid up or down on various assets such as long-term Treasury bonds.

That’s why yields have risen over the past few months on long-dated assets, even as rates have been cut. And longer-dated yields can have a huge impact on the economy that counteract the decline in short-term rates.

That’s particularly true with the 10-year U.S. Treasury yield, which still pays about 4.4%.

This sticky yield on the 10-year is causing the yield curve to steepen out. The yield curve universion suggests trouble ahead for the economy.

The good news? Investors can still lock in relatively high bond yields, particularly on longer-dated notes.

Longer-term rates may even be able to trend higher, if that reflects strength in the real economy.

Meanwhile, shorter-dated yields should continue to trend lower. Keeping short-term rates lower help smooth out the cost of government borrowing. That’s because most government bonds are short-dated notes and bills running from 30 days to two years.

For stock investors, higher yields essentially compete with stocks, particularly dividend-paying stocks. Investors may want to scale out of stocks, especially after the market’s strong performance over the past two years.

 

To view the full analysis, click here.

Economy

The Compound: The Biggest Investing Lessons of 2024

Posted on by Andrew Packer

2024 is on track as one of the strongest years ever. Even with a strong year, it still provided a number of twists and turns that could have shaken out investors at any time. One of the biggest factors impacting the market this year occurred in the bond market.

That’s because interest rates started to come down this year, at least those set by the Federal Reserve. Meanwhile, bond yields continued to inch higher instead.

This mismatch suggests that the market is looking out for further inflation in 2025. And the latest inflation data shows that higher prices remain “sticky.” It’s still not clear if inflation can get back down to the Fed’s 2% target range, especially after cutting rates in 2024.

For now, markets have remained bullish even with long-dated interest rates ticking higher. But that may not last forever.

Investors also saw a continued push into large-cap U.S. stocks. The S&P 500 rallied 27%. Comparatively, the small-cap Russell 2000 index rose about 16%, and about 7% for global stocks. That continues off the market trend from 2023, but there’s no guarantee it will hold in 2025.

Given overall valuations in large-cap U.S. stocks, there’s a chance for a sizeable market pullback in 2025. Investors will want to keep an eye on this big trend and get out of large-cap stocks if they show signs of slowing down.

 

To watch the full video, click here.