hi fellow Traders this is Larry Williams and I think it is Rally time quite a few reasons why I think it's rally time in the stock market let me share those with you first of all I think the market is now undervalued I don't mean uh oversold or or overbought I think it's undervalued and I'm gonna explain that my valuation measures AR in stock jar.com probably the most fascinating Tech to L I've ever come up with think you enjoy that also smart money has begun buying stocks in there I'll show you where that's been taking place and you know you can have a good stock but if you don't buy it at the right time you can still have problems so I like cycles and seasonals and a few other things to say right here right now is probably the right time so here's my longer term cycle in the stock market I thought you'd appreciate this you can see we've had pretty good buying points at these lows in this cycle and since we're in a bull market would get pullbacks at the Peaks so where are we now is what's more important right you can see the lows have been and here we are we're right into a low about every five six months we've seen a low in the or buying point in the stock market and that's where we are now so I think that's one reason timing says it's just about now but again timing might be off if you don't have a fundamental condition a real reason to be a buyer at this point so let's look at those real reasons um it really starts with my 2025 forecast report now I know a lot of you have this some of you didn't but this was our forecast that starts at the first of the year and we forecast would come down until about the middle of March and then we start to see this turn up so this was our forecast made last December uh the forecast report isn't available any longer I'm just showing you see uh we had a pretty good idea the decline that we've seen was going to happen and now this has turned up and there's a little more to it than that like I said my valuation model is really interesting to me because we can find when a market is undervalued this is in stock jar.com called will value you can see we're undervalued here we're undervalued in this area we're undervalued over here at a great Point uh to be a buyer in the covid crash so we can find other periods and what's interesting to me you might even see price at relatively high levels but we're undervalued in the market we're undervalued over here we're undervalued here that's significant to me uh These are times when I want to be a buyer in the market because prices have become undervalued and they will rally at some point in the future we can see the last time we were undervalued was last September price were only down for a week but we definitely hit the undervalued zone so it's not an overbought oversold indicator and look where we are now we've entered the undervalued zone as we did here as we did here now this is not a timing tool don't be misled by that it's just a suggestion that we're in the value area of stock prices and given being in a valueing area then we can look for a trend change or an entry technique but we have one condition that sets this market up as a potential area to Rally but I also like to see smart money has come in I have my money flow index that's also in stock.com we'll go back in time you can see when they've started buy you see the professionals start to buy in here the market rallies they start to buy heavily in here we rally and again it's so interesting to watch these professionals were really at a high price level here not much of a pullback or a dip in the market but they were big buyers just before the run up before the covid crash and right at the co crash they move to the buy side again so I do think that money makes the world go around and certainly make stock prices go up or down when they become sellers in the marketplace so that's another reason and if we look at recently what's gone on in the market look how big buyers they were back here and they are buyers at the lows they're usually are pretty correct in accumulating the market now this is where they are now they've just begun to get what I think is a sweet spot of their buying a lot of buying came in as we saw a lot of buying back here so this is another reason not only have we seen some valuation in this market we also see that smart money is starting to move into into this Marketplace so the flow of money they started nibbling in here they really come become much more aggressive buying or accumulating now they don't just buy and try to sell in a day or two they accumulate their position and that that's what I think has been going on in the Market at this time the other side of smart money is what we call dumb money or my advisory sentiment Index this is something I first wrote about in a book for Bloomberg well 25 years ago still the same data same stuff we're looking at when the majority of advisors are really bullish uh look what happens in the marketplace when the majority are really bearish look where we are in the marketplace the majority of advisers are really bearish well that's time usually to be a buyer here's a good example the majority of advisor were saying you should be a seller here in fact you should have been a buyer and where we are right now is about the same place the advisor have become very bearish oh my gosh you're turn on the internet anything and everybody's bearish these days right everybody's afraid well that's one thing it's hard to learn to do but you got to do it you got to buy when it feels like you shouldn't be buying uh and this is a good reflection of those emotions when most people are bearish in the market we're going to get at least some type of Bounce in the market the the magnitude of that bounce though could come from the fundamental setup like we looked at the Smart money buying is value in the marketplace or the time Cycles there as well so that's why I like to kind of combine all this stuff and put it together so with that in mind the real problem I think is Wall Street is terrified right Donald Trump and the ter what is this going to do to the market that's been the real driving force here and I think there's an answer to that I'd like to share with you in part tariffs began where I am here in St Croy in the beautiful US Virgin Islands Alexander Hamilton came from this little island went to Washington DC was our first Secretary treasure and it had big tariffs his idea was that if we could make it in America big tariffs on it if we couldn't make it in America then no tariffs on it and use tariffs as we did to fund the government until about 1913 there was no income tax all of the government revenue came in from tariffs so what tariffs may do is increase prices but they will increase jobs because if things have a high tariff on them we won't buy them from China or whoever we'll make them here so we should see an increase in the job market we may see increase in prices but and of course more jobs is really bullish but this drill baby drill thing is really interesting this will lower inflation if Donald Trump is correct and he's going to really open up the gates of oil and that's what he talks about who knows what will happen but if that does happen that's going to lower inflation which as I see it is an offset to tariffs increasing prices so in terms of inflation which has been the the talk of everybody in economics recently I think we're going to continue to see less inflation here's why inflation is really crude oil the black line is the inflation index sticky inflation the red line is crude oil look closely they go together right price of crude oil goes up inflation goes up crude oil goes up inflation goes up I mean inflation is a crude oil is a huge part of the inflation data here we see that relationship 2007 coming forward crude oil goes up inflation goes up crude oil comes down inflation comes down I mean they're just sister and brother with one another not always occasionally we see a little Divergence but by and large the cost of crude oil is the main driver of inflation and here's where we are right now what I've actually done in these charts I just showed you I push forward crude oil prices about a year in advance because crude oil actually predicts in advance inflation this is notice that we had a big increase in inflation here but this crude oil data in red was known a year and a half in advance just like now we see oh crude oil is over here it's been continuing coming down that suggests inflation is going to continue coming down so if you really want to get a good idea of inflation well if we have a massive rally in crude oil year we're going to inflate but at this point right here right now it does not look like that's going to happen uh so we have a pretty good idea just looking at the relationship of inflation to crude oil that we're going to continue to see lower inflation and maybe more important as I see it is that if we do drill baby drill there will be more oil and whenever you have more of any commodity what happens to prices prices go down you're going to have essentially the same demand but more quantity so price will decline which means less inflation which I think is a positive for the economy for us as buyers and sellers and for the stock market itself so drill baby drill this is going to be really interesting to watch to see if they really do drill baby drill because if they drill down you're going to see inflation go down so we can also look at the relationship of crude oil to stock prices I'd like you to look at this closely again we're seeing crude oil in red and we're seeing stock prices in blue this is the crash of 1987 look what happened that big rally in the 87 big increase in crude prices and then down came crude down came the stock market then crude started rally stocks started rallying crude started to come down and stocks followed suit as well so there is also relationship between crude oil and stock prices for obvious reasons here we see from 1998 into 2002 remember the stock market topped in 2002 2000 down went down a lot the S&P even more well look what happened to crude oil prices at the end of 1999 crude oil started come down and that big bull market stocks have been in ah turned into big bare market look at that what a relationship between these two fundamentals do cause things to happen the Market's not as I've always said charts don't drive the markets conditions Drive the markets and this is one of the leading conditions here we continue seeing this as I'm going to explain a little bit more about this red line which is crude oil prices in a moment there was a crash of 2008 market crude oil came down stocks followed crude oil went up stocks followed pretty good relationship and now what I've been doing again I've been pushing forward the price of crude oil in this case pushing the price of crude oil forward uh by about a year a little over a year and that's been a really good sign of what's going to happen to the stock market would up and bounce around look at the decline we've had in stock yeah there it is in crude oil and now we should start start to see a rally so this relationship of crude oil and stock prices I think is good I'm going to blow it up for you a little bit so you see a better relationship to right here so this is where we are right here right now and this is saying crude oil also suggesting for us a potential rally in the market so another real reason just as we saw rally back here just we saw this rally rally back here a real reason for stocks to have a rally at this time now what I done here this is one of my little secrets I'd like to share with you crude oil price is inverted so when you see the red line here this is crude oil turned upside down in other words crude oil was actually not rling here it was declining so there's an inverse relationship between these two so keep in mind that what you've seen is crude oil prices inverted and when they're inverted they lead stock prices so this is just one more little um Arrow you can add to your quiver to help you understand the market to look at these relationships between stock prices and really the most important thing in the world right now is crude oil you know the Golden Rule turned to be black the Golden Rule used to be who has the gold rules right that's Chang here's a simple question how long can you live without having gold how long can you live without having crude oil well you can live probably the rest of your life or for a long time without having gold but what happens if we don't have any crude oil in the world we have a world of problem the car stop the machiner sto the airplane stop the trucking well we're in the world hurt so this is why crude oil is so important and such a critical part of the economy and why it has such an effect on stock prices inflation and and just the concom relationship across the board so we really have to focus on this as a driving force of the economy of the world so we can also look then at Black Gold and yellow gold I think the gold people enjoy looking at this the yellow line you see is obviously gold prices and the black line is uh crude oil black gold right crude oil and you see again pretty much they dance the same tune don't they Black Gold goes up real gold goes up Black Gold goes up real gold goes up they come down together they go up together so there's a relationship there that you as an investor or a Trader can also take advantage of in whatever you're doing here we see it into 2020 Black Gold went up gold went up Black Gold came down gold went down Black Gold went up gold went up okay so we get to see that relationship um and it's a powerful relationship that's been there a long time this is where we are right now I'm bringing this up to date for you uh Black Gold started to go up late 20 22 and gold started to come up Black Gold got really strong gold really picked up to the upside so I know what you're thinking where are we right here right now Larry well it looks like we get choppy but around 6:15 this relation which is another inverted relationship shows that again we start to see gold move back to the upside it looks like gold should make new highs in here so this is a early June middle of June which should start to another really good buy point we can look how closely this has happened in the past there was a forecast buy point no look at that known six seven months in advance right this remember gold prices here are lagged in other words crude oil prices in Black are pushed forward so we knew about this in advance just like we know about this now we know about this now these points this is critical for your understanding we're known in advance the problem most of us have is this traded we really don't have a good view of the future like we look at a chart we don't know if it's going to go up or down we might have a bias emotional or intellectual bias but here we say oh I got it this is what most likely will happen in the future because really as speculators we need to live in the future you can't think about today you have to be living I'm living out here was how's rest of this year going to finish what's going to happen I'm I'm living out here and I can see from the forecast of crude oil a pretty good idea what's going to happen to Gold again crude oil is inverted all the crude oil data you see here has been inverted in other words it's been turned upside down uh where it looks like it's been rallying no crude oil was going down during this time period so you need to understand that if you're going to look at the relationship of these items well let's get more about okay looks like a lot of good things might be happening Larry but is it time and I think we are in a bullish wave this is part of my cyclical studies uh this red line shows a wave that really kicks into the marketplace you see it kicked in here kicked in here kicked in here it's been pretty reliable here September 2021 it kicked in just at the lows in 22 it kicked in kicked in again and again in 2023 last year kicked in again and this is where we are now at the end of this month this red cycle kicks in typically in the past prices have rallied about 80% of the time when we've seen this wave now is that a cycle um it's hard to say exactly what this is but it's a wave that continues to drive prices in the market and this wave is just about where we are now so we're getting into end of this month we should see this bullish wave kick up into prices as we've seen it in the past will it call the absolute low no but does you get a a good idea when to start to look for a rally yeah um and it's saying that we're just about there the middle part end of this month we're almost in the middle of March now should be a time to expect prices to Rally so I think as rally time so there's some stocks we might want to look at one would be Tesla if we look at my money flow index we see that smart money which is buying Tesla back here and over here and here and here and here and here and here right look what they started to buy Tesla again so you go to stockcharts.com you put in our money flow index you see when money big money started to buy so that's one reason I think the Tesla could rally now if we also look at the seasonal pattern in Tesla it also starts to turn to the upside just about the middle of April last year year before so we have the seasonal is starting to get bullish on this market and we see smart money has started to buy we can also look at my valuation index and we see Tesla is undervalued here as it was undervalued here as was undervalued here and undervalued back here I know there's a lot of news about Elon Musk and oh he's going to destroy the government or save the government I don't know what's going to happen they're going to throw out some good babies with the bath water and all this cutting that's for sure but when I look at the conditions of the stock I see what I like to see undervalued the right time is coming soon and we've seen smart money start to buy the stock that to me sets it up as a buy Point here's another stock you might want to consider this is an ETF xlp xlp is consumer staples it's a group of consumer companies let's see here they are Proctor and Gamble Costco Walmart Coco all the things that we all eat and use and shop at right that's what's in xlp and we look at my cycle forecast and xlp it suggests we're coming into a low we see that it's in an undervalued Zone as it was back here and professional money was buying here they're not quite aggressive buyers yet maybe after this week they will be but we're starting to see this Market get set up as well when I turn my cycle machine I see we're also getting oh the first part of April we're getting into a low for xlp so this is another Market I think you want to consider and again when we get into this Zone this blue line we have about an 80% probability of rallying from somewhere in the middle of April 1 of April into September so there's another stock I think you might want to pay some attention to uh as things progress okay so let's take a look at what they own those are the companies that xlp has invested in you don't have to buy Coca-Cola or Walmart or Costco you could buy this stock and you're effectively going to have a position in all of these stocks that might be an easier way for some some people who want to be in the consumer goods section and I think this section probably will not be as much influenced uh by tariffs because um some of these are but Coca-Cola is sugar and they're making Coca-Cola and beverages right Philip Morris is now basically Altria Food Company pepsic Co again food company Mand food alria food Colgate poal soap and stuff not a lot of things we're importing with high tariffs on them Target maybe a little differently maybe Costco but by by and large this group I don't think will have as much of an impact on tariffs or higher prices which might result in lower sales Nvidia this is a stock last year everybody wanted to own this year nobody wants to own so where are we right here right now with the stock it just started to become undervalued as it was back here was close to undervalued back here so here's another stock that's a lot of people been following it some for the wrong reasons but we're starting to see it get set up as well so what's professional money been doing it what's the funds been doing it there are big buyers up here and they just recently started to buy it again so that's a bullish consideration for us to consider those who are a lot of you are in Nvidia and going oh what am I going to do well you have some hope here you have some relief for this stock now because we're starting to see undervalued and professional money coming into the this Marketplace we can also look at the seasonal pattern here uh the seasonal pattern we should rally a bit and then take off the middle of April that's what usually happens now this is what I want to point out to you look at this carefully the red line notice Nvidia is lower here than it was here most stocks are lower now than they were back in January that's most stocks the stocks I want to buy are the ones that are higher now than they were in January those are the ones that attract me the most because they held up the best on this recent decline you may have noticed back here when we're looking at xlp it's higher now than it was back here so it's held up better than say uh Nvidia right which has come down so I want to look for the stocks that didn't get beat up that's one of the criteria I look for so we look at asml which is about the same business in videoid oh it's held up much better hasn't it so you might want to look at that in terms of your stock selection or your own stock screening which stocks in this recent decline held up the best uh the ones that got beat the most they might have a bounce back but obviously they were in stronger hands this was in stronger hands coming down than Nvidia was coming down so I like to buy stocks that have been in strong hands we look at Apple right now Apple just just kissed old lows it was stronger than Nvidia Nvidia remember most stocks are a lot lower now than they were here so Apple also has held up comparatively better than the average itself and it is at a cyclical point when we would expect this Market to Rally based on the seasonal pattern in the stock market so that kind of wraps up um what I see in stocks here uh I think the big thing is coming up is what could cause this rally what's going to ignite it and I think it's going to be this the war in Ukraine was end that Donald Trump will negotiate some type of agreement between Ukraine and Russia and maybe NATO who knows and the US and I think that is most likely going to be the trigger mechanism to see things like Apple start to move back to the upside just because it's an emotional uh setting in the market place like oh something got accomplished here so I think that's the most important news toate attention to but if we look at my cycle forecast remember they're all saying we should rally right here right now so I think the news will come out and just justifies what the cycle has already told us so to wrap this all up I think it's rally time and I think it's rally time for fundamental reasons for technical reasons for cyclical and seasonal reasons I hope you've enjoyed today's presentation I hope you've learned from it um there's so much to learn about the markets it's really my privilege to share what little I know with you and thanks again to stock.com because they made all of this possible