The Monday Morning Playbook: Week of February 10, 2025

Good morning,

I normally struggle to condense all my thoughts on a complicated and ever-changing market into this brief introduction each week.

But this week, I have the opposite problem.

I have almost nothing new to say from a top-down, big-picture perspective.

As is common in year 3 of a bull market, the major indexes continue to chop sideways frustrating bulls and bears alike.

There’s more good than bad under the surface. Still more opportunities to make money on the long side than the short side and still few to no signs of an imminent recession or bear market.

But for even tactical asset allocations like our ETF models, it’s more of the same. Wait and see and be careful chasing relative strength because this market isn’t split at the cyclicals vs. defensives level, or the sector level, or even the industry level. For the most part you have to go all the way down to the individual stock level.

There are good consumer staples and bad consumer staples. Strong tech stocks and weak tech stocks. Gold is strong, oil is terrible. Wherever you look, it’s hard to come up with dominant themes.

2 potential solutions:

1. Be willing to go down to that individual stock level. At the risk of jinxing it, performance for our Blue Chip Hot List has been exceptional recently. More so than just skill, I think it reflects a market that is continuing to reward strong stocks and is not rewarding bottom-fishing.

2. Speaking of fishing… Go fishing.

The famed investor, Jesse Livermore once said, “There is a time to go long, a time to go short, and a time to go fishing.”

This week’s calendar suggests that may be risky, with CPI, PPI, Powell’s testimony before Congress, and earnings from some of this market’s biggest winners due up.

But the price action is what we’re here to follow and despite plenty of catalysts recently, the chop continues.

This week’s report will review:

• Last week’s action

• Yellow flags flashing in Bitcoin

• Upcoming earnings

• Fixed income markets ahead of CPI

• ETF movers

• and more!