The 'Calm' Could Be Over

It's been too 'calm' lately... Rocky waters could be ahead... Where expectations might not meet reality... The same but different... A pattern worth monitoring... Steer clear of the danger... [Stansberry Research Logo] Delivering World-Class Financial Research Since 1999 [Stansberry Digest] It's been too 'calm' lately... Rocky waters could be ahead... Where expectations might not meet reality... The same but different... A pattern worth monitoring... Steer clear of the danger... --------------------------------------------------------------- Another round of volatility is likely ahead... Our Spidey-Sense is tingling... It had felt too calm lately (until today)... and several potential market-moving events are within view... I (Corey McLaughlin) mentioned yesterday that we'll learn a key inflation number on Friday. That's the personal consumption expenditures ("PCE") monthly data that the Federal Reserve folks say they look at the most when making policy decisions. We also mentioned the big companies on deck for earnings this week like Microsoft (MSFT), Amazon (AMZN), and many others. Plus, on Thursday, the government will post its first estimate of first-quarter gross domestic product ("GDP") numbers. In other words, cue up the Recession Watch themes, stories, and what-have-you in the financial media. A few decimal points one way or another in these reports could cause – and I would argue likely will result in – some knee-jerk reactions from the overactive Mr. Market. Today, we already saw some signs... The major U.S. indexes were all down, with the small-cap Russell 2000 leading the way, off more than 2%. The benchmark S&P 500 Index finished down 1.5%, and there was a lot of red across asset classes on the day except for bonds and gold. The CBOE Volatility Index, or VIX – which measures options activity and sentiment around U.S. stocks and is useful to follow as a gauge of "market fear" – popped by more than 12% today. And it wasn't just the scale of the move, but where it's coming from. The VIX had been falling for five straight weeks... A few days ago, the VIX was under 17 for the first time since January 4, 2022. Those who have been following along since then will likely remember that was the very "top" for U.S. stocks before the major indexes tumbled by 20% through October. (I also should mention that discussion has been increasing in financial circles lately about the usefulness of the VIX, Wall Street's use of [zero-days-to-expiration options]( and whether or how they are distorting this index's meaning. Regardless, on balance, the VIX remains useful for market analysis because the activity that influences it is part of the story.) We can't say for sure what will happen next from this point, but this is a definite time to pay attention. The markets haven't been this "calm" in more than a year... which means it might be time to expect some rocky action. The biggest reason might be this... As our Ten Stock Trader editor Greg Diamond alluded to in [a market update for his subscribers today]( all of these news events lead into the Federal Reserve's next policy meeting next week on May 2 and 3. Inflation data and the latest look at GDP will be among the numbers the central bank will weigh as it plots out the interest-rate-policy path for the months ahead. As Greg wrote... With tech earnings kicking off today, inflation data coming out on Friday, and both semiconductor earnings and the next Federal Reserve meeting on deck for next week, we should be setting up for great trading opportunities across many markets. And remember, stock prices are largely based on future expectations. When there are disconnects between expectations and reality, that's when prices move... At the moment, fed-funds futures traders expect the Fed to cut its benchmark lending rate starting at the Fed's September meeting, with higher odds on cuts happening at its November meeting, according to the CME Group's FedWatch Tool. (The Fed doesn't have an October meeting.) Say Fed Chair Jerome Powell really hammers the point home next week that there's no way in heck cuts will happen in 2023. Stock prices could pull back as investors adjust expectations for what's appropriate value in a world where rates stay higher for longer. This has been the same conversation for over a year... Enough parts of Mr. Market don't believe the Fed. They want to believe the central bank will "pivot" and start cutting rates again like people have been conditioned to see over the past 15 years. With inflation first at 40-year highs and still sticky, though, it has been a different ballgame. Even with a run on a few banks, stocks selling off 20% in 2022, and "safe" government bonds having their worst year since the pen and quill, the Fed hasn't been in a rush to cut rates... and still doesn't appear to be now. Here's our latest reading of [the tea leaves](... If anything, the monetary policy string-pullers at the central bank appear inclined to raise rates one more time by 25 basis points next week and hold things there until further notice. This doesn't mean U.S. stocks – which have been trending up since October – will begin a new long-term downward trend or that a new lower "bottom" is ahead. But a decent-sized pullback is not out of the question, based on a few indicators... Our DailyWealth Trader editor Chris Igou showed a technical analysis [to his subscribers yesterday]( on all the stocks listed on the New York Stock Exchange ("NYSE"), which suggests the next sell-off could even hit October's lows. A pattern worth monitoring... Chris explained the "head and shoulders" pattern – one of the most commonly followed in technical analysis – that we can apply to any stock or index and behavior that the NYSE Composite Index could be showing today. As Chris explained... It happens when an asset rallies higher and pulls back. That creates the left shoulder. The asset then makes a higher high and pulls back again. This second pullback typically ends where the previous pullback ended. Then the asset bounces higher once again, right around the same level as the previous shoulder. And once that right shoulder forms, we know another drawdown is near... The key to determining the potential scale of the next move is to keep following the "right shoulder" to see if it continues forming. Technical analysts also measure the distance from the head, or the peak, to the "neckline," an average of the previous two lows – in this case, December 2022 and last month. Existing DailyWealth Trader subscribers and Stansberry Alliance members can find the full piece [here](. Based on Chris' analysis, if the NYSE Composite Index does keep forming this head-and-shoulders pattern, stocks could drop 12.5% back toward the October lows. When paired with another momentum indicator Chris shared with his subscribers, he offered... Don't bet on a rally in this index from here. The smart move is to steer clear until that next drop lower. This broad market index is a warning sign for investors. If it falls lower, we could see other parts of the market fall too. We will keep a close eye on this for now. But the next drawdown is likely getting underway right now. This is a pattern worth monitoring... especially with market "fear" having been at a year-plus low recently... and plenty of reasons for Mr. Market to have a fit in the next two weeks. Rick Rule: Why I'm Using More Cash Rick Rule, founder and CEO of Rule Investment Media, says central-bank digital currencies are the "worst possible nightmare" because they will allow governments to monitor people and their money. "I am using more and more cash," Rule tells our editor-at-large Daniela Cambone... [Click here]( to watch this video right now. For more free video content, [subscribe to our Stansberry Research YouTube channel](... and don't forget to follow us on [Facebook]( [Instagram]( [LinkedIn]( and [Twitter](. --------------------------------------------------------------- Recommended Links: # [Until MIDNIGHT: Claim 1 Free Year of Income Intelligence (and More)]( Until midnight tonight, you can claim a FREE year to what may be the ONLY strategy that could pay you 14% yields (or more) with little risk... and set you up for long-term income streams as high as 29% per year... plus HUGE capital gains. 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In today's mailbag, feedback on [yesterday's Digest]( where we shared a bit of everything that our editors are doing today... And thanks to those of you who have sent in feedback about the revamped Stansberry NewsWire. Keep your thoughts coming and, as always, send your comments and questions to feedback@stansberryresearch.com. "I really appreciate all of your news and suggestions, especially your genuine care about 'outside of the loop investors'... Most of us miss some of the great finds you report. Again, Thanks." – Paid-up subscriber Frank S. All the best, Corey McLaughlin Baltimore, Maryland April 25, 2023 --------------------------------------------------------------- Stansberry Research Top 10 Open Recommendations Top 10 highest-returning open positions across all Stansberry Research portfolios Stock Buy Date Return Publication Analyst MSFT Microsoft 11/11/10 1,017.8% Retirement Millionaire Doc MSFT Microsoft 02/10/12 875.9% Stansberry's Investment Advisory Porter ADP Automatic Data 10/09/08 775.4% Extreme Value Ferris HSY Hershey 12/07/07 629.6% Stansberry's Investment Advisory Porter wstETH Wrapped Staked Ethereum 02/21/20 604.9% Stansberry Innovations Report Wade WRB W.R. Berkley 03/16/12 507.6% Stansberry's Investment Advisory Porter BRK.B Berkshire Hathaway 04/01/09 478.1% Retirement Millionaire Doc AFG American Financial 10/12/12 409.6% Stansberry's Investment Advisory Wade FSMEX Fidelity Sel Med 09/03/08 327.2% Retirement Millionaire Doc ALS-T Altius Minerals 02/16/09 307.3% Extreme Value Ferris Please note: Securities appearing in the Top 10 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the model portfolio of any Stansberry Research publication. The buy date reflects when the editor recommended the investment in the listed publication, and the return shows its performance since that date. To learn if a security is still a recommended buy today, you must be a subscriber to that publication and refer to the most recent portfolio. --------------------------------------------------------------- Top 10 Totals 4 Stansberry's Investment Advisory Porter 3 Retirement Millionaire Doc 2 Extreme Value Wade 1 Stansberry Innovations Report Engel --------------------------------------------------------------- Top 5 Crypto Capital Open Recommendations Top 5 highest-returning open positions in the Crypto Capital model portfolio Stock Buy Date Return Publication Analyst wstETH Wrapped Staked Ethereum 12/07/18 1,457.2% Crypto Capital Wade ONE-USD Harmony 12/16/19 1,165.0% Crypto Capital Wade POLY/USD Polymath 05/19/20 1,073.0% Crypto Capital Wade MATIC/USD Polygon 02/25/21 888.9% Crypto Capital Wade BTC/USD Bitcoin 11/27/18 632.6% Crypto Capital Wade Please note: Securities appearing in the Top 5 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the Crypto Capital model portfolio. The buy date reflects when the recommendation was made, and the return shows its performance since that date. To learn if it's still a recommended buy today, you must be a subscriber and refer to the most recent portfolio. --------------------------------------------------------------- Stansberry Research Hall of Fame Top 10 all-time, highest-returning closed positions across all Stansberry portfolios Investment Symbol Duration Gain Publication Analyst Nvidia^* NVDA 5.96 years 1,466% Venture Tech. Lashmet Band Protocol crypto 0.32 years 1,169% Crypto Capital Wade Terra crypto 0.41 years 1,164% Crypto Capital Wade Inovio Pharma.^ INO 1.01 years 1,139% Venture Tech. Lashmet Seabridge Gold^ SA 4.20 years 995% Sjug Conf. Sjuggerud Frontier crypto 0.08 years 978% Crypto Capital Wade Binance Coin crypto 1.78 years 963% Crypto Capital Wade Nvidia^* NVDA 4.12 years 777% Venture Tech. Lashmet Intellia Therapeutics NTLA 1.95 years 775% Amer. Moonshots Root Rite Aid 8.5% bond 4.97 years 773% True Income Williams ^ These gains occurred with a partial position in the respective stocks. * The two partial positions in Nvidia were part of a single recommendation. Editor Dave Lashmet closed the first leg of the position in November 2016 for a gain of about 108%. Then, he closed the second leg in July 2020 for a 777% return. And finally, in May 2022, he booked a 1,466% return on the final leg. Subscribers who followed his advice on Nvidia could've recorded a total weighted average gain of more than 600%. You have received this e-mail as part of your subscription to Stansberry Digest. If you no longer want to receive e-mails from Stansberry Digest [click here](. Published by Stansberry Research. You’re receiving this e-mail at {EMAIL}. Stansberry Research welcomes comments or suggestions at feedback@stansberryresearch.com. This address is for feedback only. 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