Investor's Edge with Gary Kaltbaum - Good Reaction to Bad Data [04.30.2025 w. Adam Sarhan]

Episode Date: April 30, 2025

https://garykaltbaum.com/The market opened lower today after economic data sparked recession and stagflation fears. However, the market rallied for most of the day and had a strong close which was a strong reaction to bad data. It's the end of the month for the market and we break down the action for the month of April. 

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That's Tommyjohn.com, Code Comfort. Tommy John. Comfort perfected. Investor's Edge with Gary Coltbaum. Straight talk about you and your money. Now from the BizTalk Studios, here is Gary Cultbaum. And welcome once again to Investors Edge. I'm Adam Sarhan, in for Gary Kaye, who's out today. Today is Wednesday, April 30th, 2025, and we have a great show for you tonight.

As always, we want to thank you very much for being here. All right, before we dive into the show, and everything that's happening in the market and the economy. Let's talk about some housekeeping notes. You know, this is a show about you and your money and all the fun points in between. Just as a quick reminder, if you don't get this show in your city, you can go to GaryK.com or listen live or archive.

We are live Monday through Friday, 6 to 7 p.m. Eastern. Also at GaryK.com, you can follow Gary on X, formerly known as Twitter by just pressing the button. You can subscribe and get Gary's morning notes sent directly to your inbox. for free every day or during market every day during the week let's put it that way every market day if that's a word every business day how about that and you can email gary read the rest of his commentary ask about his uh you know see his posts and also ask about his money management services or whatever it is that you want to do if you want his premium service where he

updates members in real time several times a day does daily webcasts again business day on daily webcast actually it doesn't on the weekend too uh you can go to conviction That's convictionleaders.com. All right. Let's dive into today. We have, we had a lot going on today. We have a lot of news. So in the morning before the open at 8.30 Eastern, the government comes down since GDP came in and contracted in Q1. What does that mean? Well, GDP measures the growth of the economy and it either expands, healthy economies expand. Over time, it expands and there's periods where it contracts. One quarter of contraction is not the end of the world. Imports soared in Q1 because understandably so, people were worried about tariffs. So they're going to buy a lot of stuff. Now they have a lot of inventory and they did that because if you buy stuff before the tariffs are enacted, you don't have to pay the tariffs. All right. So imports went, I mean, through the roof, huge, but also the economy contracted 0.3%.

It wasn't huge contraction. It wasn't 3% or 5%. It was 0.3%. All right. And that's the first read on GDP. That can change. Up or down, but that can change by the time we get the final read in the next few months by the end of this quarter. Okay, great.

So it comes in weaker than expected. Economies or analysts were expecting minus 0.2%. It came in at minus 0.3. So, okay, great. So it's a little bit weaker than expected. So that means in the first quarter of 2025, the economy contracted. But if you look a little bit deeper, the inflation component of GDP, I won't get into the specifics, was much higher than expected. So inflation up, economic growth down.

That's important to know. And what that's another word for that is stagflation or stagflation. What does that mean? Inflation goes up while the economy is just stagnating. It's not really moving, not growing. Let's put it that way. So that's not a good place to be. Why?

Because it impacts both monetary policy and fiscal policy. Two big words, monetary policies from the Fed and fiscal's from D.C., Congress, you know, the rest of the D.C. So, all right, White House Congress, etc. But specifically Congress and spending. Okay, great. If the Fed wants to cut rates, let's say the market has another leg down, but inflation's going up, their hands are really tied. Now, of course, they can always do whatever they want and cut rates and justify it based on whatever they want.

But more, you know, as a general, generally speaking, it's a general statement. The Fed will cut rates in a much easier to cut rates for the Fed if inflation is down. And it's much harder for them to cut if inflation is up. All right. So big picture right away at 830 futures just implode. Nasdaq futures, tech stocks, S&P futures, Dow futures, just boom. Market opens an hour later at 930 and we gap down. All right. Not a good open. But what ends up happening? Throughout the day, the market just basically rallies all the way up until the close. Now, you have a few things that are important to note.

Trade deals are in play, in focus. White House shared some news. You want to say leaked it, shared it, whatever word you want. I'm not here to play politics. I'm here to show you markets and the impact on markets. That there's a possible trade deal pending. Could be with India. Could be with another country.

But they're very close to a trade deal. Okay? That helped the market rally after a week. week open. And you saw the market, lots of areas as well, step, you know, just the bulls in step in and say, oh, you know what? It wasn't as bad as expected because when you see the market closed in the upper half of the range, especially a day like today where we had every chance in the world for it to fall. And yesterday, we rallied into the 50 day, hit a wall, and then we gap down this morning. What does that, quote unquote, mean? All right, most likely,

we're going to continue to fall. It doesn't mean we have to continue to fall. It just means odds are we're continuing to fall. You've got bad economic data. A lot of earnings came out today. I'll go through some of those. And you saw a lot of stocks gap down on earnings today. And instead, what happens? Market rallies. Well, it closes the upper half of the range. Some of the indices closed higher. But for the most part, it was a mixed close. But it was a strong close nonetheless because you closed in the upper half of the range. So when you put the pieces of the puzzle together, right, the Dow closed up on the day, up 141 points or right around 40,669. The S&P closed up eight points, but after being down a lot more, right? NASDAQ closed down a little bit, 0.09%.

But, and the Russell was down just a hair, but upper half of the range nonetheless. And when you go under the surface, you can look at areas like the financials, XLF. They rallied today, closed a little bit higher, but they bounced off of the 200-day moving average. And they closed right near their 50-day moving average. This is the X-L-F. If you want to track it at home, you can see it. It had every chance in the world to fall, and instead of falling, it ended higher. And it closed one penny above its 50.

but it was a good defensive day. The semiconductor stocks, SMH, same thing. Big defensive day. It's below its 50. It's below its 200 days. It's weaker than the financials. But it closed up on the day and it had a big reversal. And it's moving sideways for the last four or five days here,

almost building a little handle consolidation after a big move up from last week's low. And on the up days with the SMH, volume, has been higher than the down days. We had two down days yesterday and the day before. And guess what? Both of those days, you barely moved in the SMH and volume was low. So volume patterns are coming in, quote, unquote, better than expected. Maybe there's a change of trend here or something is happening, right?

The cues fell today, had every chance to the world to fall. Instead, rallied right back, closed just beneath their 50-day moving average, an area to watch. We have a lot more earnings, by the way, after the close, which I'll get to in a few minutes. But even the S&P, the SPI. You're up now, what is it? One, two, three, four, five, six, seven days in a row. That's a lot. After a big sell-off, right?

And again, the big view was that, okay, we'll get trade deals and come out of that stronger. That's the idea. But you're still below the 50 there. Watch the 50. You know, the Dow, same thing. I think you're up there. where is it three and four. So seven days there, six, seven days.

I'm going to count fast here. One, two, three, four, five, six. Yeah, seven days in the Dow, DIA is the ETAF. And you're coming up to the 50 day. You haven't actually got above it, but you're coming up to it. It's a better tone. Right? The fact that you, I don't want to say, rallied on bearish news,

but the fact that we didn't collapse on bearish news, to me that's a bullish. reaction or that's bullish in and of itself. Why? Because it's not the news that matters. The news tells us what happens, you know, in the first quarter, what happened, excuse me, in the first quarter. The market's a forward-looking mechanism. So what if we have a positive outcome here? We get a bunch of trade deals and then boom, you're off to the races. And terrorists go away and you're off to the races. And you have a better situation than you did before the tariffs. Oh, okay. There's a positive outlook there. The market's starting to start.

to sniff that out, especially with all the news that's coming out of the White House saying, oh, getting close to trade deals, this, that, you don't think over the last seven days. Not surprisingly, the market's rallied over the last several days. So, again, it's not the reaction to the news that matters, folks. Sorry, it's not the news that matters. It's the reaction to the news that matters the most. Even stocks that got clobbered overnight, Starbucks was down big and closed the upper half of the range after reporting earnings.

right Spotify had fallen excuse me SPOT is a ticker there Starbucks is SBUX Spotify fell yesterday and then it rallied closing the upper half of the range yesterday

and then jump today and now it's above where it was on Monday before they reported earnings that's a good recovery so again we'll take our time we've got a lot more to cover it's one day today it's a good day good close

I'm Adam Sarhan this is the one and only Investors Edge. Hi, I'm Gary Kalbaum, hosted a nationally syndicated radio show Investors Edge. We're not just handsome radio people. We manage investors' money for a living, specializing in fee-based discretionary money management. No big commissions, just a fee on the assets that's managed.

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for success. Learn more at ASUonline. www.asu.org. It's time to switch on the integrator units and get the brain cells working. You're listening to. Hey, this promises to be fun. Investors Edge.

The last bastion of quality programming. With Gary Coltbaum. It doesn't get better than this. And welcome once again to Investors Edge. I'm Adam Sarhan in for Gary Kay, who's out today. In case you missed any of part of the show, you can go to GaryKK.com, rewind, fast forward, listen at your convenience anytime you want, all for free on any device, 24-7. So we spoke about the news. It was bearish news

this morning. Market closed higher, if not upper half of the range, mixed to higher. It was a very strong positive reversal. And that's what matters. So this dagflation fears may be overdone. That's what the market's saying. And again, I like to say in my book, it's called psychological analysis you can get on Amazon or Barnes & Noble. And thank you, everybody, for leaving good reviews and reaching out and letting me know what they like about it. I say there's an infinite number of ways to make money in the market. The idea is to find one that works for you.

I also say the market speaking and then ask, are you listening? And the way the market speaks, it's nonverbal communication, just like most humans. Turns out most of our, I don't know if this is an absolute factor, not. so take it with whatever psychological grain is thought, you know, salt you want. Double check this. I'm not stating this in absolute certainty, but I read it somewhere that most human communication is nonverbal. So the market's nonverbal.

It's not going to come out and say, hey, I'm going higher. Hey, I'm going lower. It gives you clues, price, volume. All the news is baked into the price. What shows up in your statement? Not the news, not volume, not earnings, not schmernings. price. And that's why for me, price is primary. Everything else is secondary. So when you see a stock like Spotify gap down on numbers yesterday and then rally today and repair all the damage and then some,

that's a good sign. After the close today, we have several stocks that have reported earnings. I'm going to go through a few. I believe, yeah, Qualcomm came out with numbers. Q-C-O-M is a ticker there. down about 4.5% right after the close. We also have meta, M-E-T-A report earnings. They're up about 4.4%, 4.4%. That could change. That's a good reaction. Qualcomm, not a good reaction. Other stocks are going to be reporting. I'll share that later as the day goes. We're in the midst, or the middle, like Gary says, the midst. We're in the middle of one of the busiest weeks in all of earnings season. Microsoft came out, and they're up about 5.5%. Now, this is still fluid. It could change. They still have their earnings calls and they can see what their CEO say and the team and the analysts and all that kind of stuff. But for now, it's so far the reaction to the earnings so far have been positive. Now, another important point is that it's end of month. And we tend to see a rally into end of month. And that could be what's happening now. I'm not taking anything off the table.

especially in this market. Now, could we have a bad headline overnight and wake up tomorrow or down a lot? Yeah, of course. So I'm not in a situation where it's like, oh, okay, you know, all bullish, just go gangbusters and all clear and buy, buy, buy, buy, buy, buy, buy, buy, buy, yeah, not so much. I'm just saying that we've had, there's more bullish pieces. Here, let's use something Gary likes to say. There's more bullish cards coming out of the deck, right?

there's more bullish pieces stacking up. That's it. On a weekly basis, and actually on a monthly basis, today's end of month, so I can talk about end of month also. This was a strong recovery this month. We had every chance in the world to fall, and instead, we ended in mixed to higher. The NASDAQ 100 ended higher this month. I'll give you a month-end review now over the next few minutes. in the middle of the beginning of the month really in April early April we pulled back down to 402 the high in

2021 was 408 so it was resistance it now became support if you haven't done so I recommend go look at a monthly chart of the NASDAQ 100 the QQQ and you can see it almost perfect line in the sand the old chart highs that 408 level became resistance and the day that it hit that 408 it under cut it went to 402, it was the low. It was April 7th, and it closed that day at 423. Didn't even close below 408. That is impressive. The next day, it fell a little bit, closed at 409, and then just rallied since. The day after that was that 4-9, April 9th. He had that huge day. It was the biggest update in the NASDAX history. When Trump came out and said, hey, guess what, we're going to give the 90-day extension and lower the tariffs and this, that, and the other thing.

And it's a good time to buy and blah, blah, blah, blah, blah. Huge rally. That was a day three follow-through day or a confirmation of a new rally attempt. And then you sold off hard for the next maybe week and a half or so. And then the middle of last week on the 21st, market came out and said, oh, got some more headlines out of the White House, positive headlines on trade. And guess what? Virtually straight up since then. That's the NASDAQ 100.

The NASDAQ composite, similar situation. 16212 was the old chart high from 2021, so 21, November of 21. The low, this time around or this month's low, was 14784. So it undercut a little bit, but on a closing basis, we're up at 17446. Just extremely powerful. And why am I taking time to talk about the monthly outlook? It's important to step back and look at the forest, not just the trees. or the leaves in the trees.

A lot of people look at the intraday charts. I call that the leaves in the trees, the minute chart, the five-minute chart. The daily chart is the actual trees, in my opinion. The weekly, monthly, and quarterly and annual charts are the actual forest. You know, this is a big reversal month, the month of April.

Big defensive month. Let's look at the S&P 500. Look at SPY since we can trade then. The S&P 500's old chart high was 479 in 2021. The low this time around was 481. I'll say it again. 479 was the high in 2021. 479.

The low was 481. Didn't even undercut the low. And closing the upper half of the range. Closed down four points for the month, but still upper half of the range, especially after bouncing off of what was resistance is now support. Wow. That 481 level?

Wow. That is impressive. Go back four weeks ago. at the beginning of April, the end of March, and asked me, hey, would that happen? Probably, it's possible, but I wouldn't have given it a high probability event. Now, if the facts change, like the facts did change, right?

The White House, like Trump did the 90-day extension that day, and then the market took off. And, you know, the facts change. Okay, there's progress on trade deals, so on and so forth. All right, we've got to change as well. I'm not the kind of guy that's going to sit here and say, oh, I was bearish on this, right? I was bullish on that.

No. When Lord Keynes, a famous economist, had a great line. He goes, when the facts change, I change. What do you do, sir? It's a big, big, big, big way of philosophy and just being open-minded, right? And evolving and changing and staying in harmony with the market. It's a play on the word harmony. It's not a real word. I made it up. It's harm money. What's the idea there, stay in sync with the market. It's very tempting and very easy to try to quote unquote fight the market. Trust me, I've done it for years.

It's a losing proposition guaranteed every time. Your ego gets in place or into play. I'm right. I got to prove the market wrong. Blah, blah, blah, blah, blah, blah, blah, blah. That's why I wrote the book, the psychological analysis. I'm not a psychiatrist. I'm not a psychologist.

I just, I'm a practical guy. And I know humans make emotional decisions. I want to make better decisions. All right. Up next, we've got a lot more to cover. I'm Adam Sarhan. This is the one and only investors edge. Guys, it's no use putting it off.

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Sprinker, because if you're going to talk to yourself for an hour, you might as well publish it. please with that. The crowd is just on his feet here. He's a Cinderella boy. With Gary Colbomb. It comes highly recommended. You're going to feel better if you talk to him. And welcome once again to Investors Edge. In case you're just joining us or missed any part of the show, you can go to GaryK.com. Rewind, fast forward. Pause. Listen to any part of the show, anytime you want on any device, all for free on GaryK.com. All right, so we left off talking about the importance of making rational, not emotional decisions, but how people make decisions, right? All right, be flexible in the approach. Stay in harmony with the market.

Listen to the market. I always like to say the market's speaking and ask, are you listening? Well, how do you listen? If the market's not literally talking, the way you listen is by focusing on price, on how the market behaves. imagine I walk into a room and I start acting very erratic and I jump up and down and all this weirdness comes out. You're not going to want to be around me. Okay, great. Now imagine I walk into a room. I'm calm, cool, collected, smile. I have good energy. Much higher likelihood people are going to be attracted to that type of a character, opposed to one that yells and screams and jumps up and down

and curses and goes nuts and this, that and causes chaos and breaks things and throws a chair around the room and just goes bonkers. I'm not saying emotions are bad. I'm just saying I think of the behavior. And a lot can be learned by how the market behaves. And one of the best tells is the reaction. I spoke earlier about the importance of focusing on the reaction to the news. It's not the news that matters. It's the reaction to the news, right?

All right. Same thing with earnings. Well, this company lowered guidance or didn't report guidance. Or Adam, what if we're in a recession? What if we're in a correction? but we are in a correction, but what if we're in a bare market? All right. You adjust.

That's the power of this business. Is there quote unquote no rules requiring us to be anything? I don't have to buy a stock. I don't have to be fully invested. I don't have to be anything. Some big funds, hedge funds, mutual funds, so on and so forth, institutional investors, they have mandates and charters. they have to be fully invested or 95% invested all the time.

I know. I have many of them. I've worked with them. I've been clients. I see them. Just how the world works. These guys are just a different, different, almost energy of vibration, different universe.

They're different, you know, a pond that they're swimming in. Keep going fishing. It's a different pond. Their hands are tied. I have portfolio manager one time telling me, Adam, I want to get out of the way. I can't. So he takes a defensive position. There's a way just to do that with.

defensive ETFs and so on and so forth. But he has to always be invested. Thankfully, most investors don't have that requirement. They have the flexibility. So when you look at the market and you look, oh, okay, let's stay in harmony. The financials are back barely above the 50, but back above the 50. The XLF, right? We spoke about that earlier.

And we've got bullish patterns forming in the market, which mainly we've seen a lot of double bottom patterns. Double bottom looks like a W. Not a perfect W, but somewhat of a W. And you can see that in Spotify, actually, if you wanted to, you go SPOT. You got a double bottom forming there. One bottom, the left side of the W is 48365, and the right side is 47501. And now you're coming up to the middle of the W, which is 62120.

Netflix. Let me go check. Did that a few weeks ago. Yep, had a double bottom. NFLX. You can take a look at this on a daily chart when you have a chance. 8.5-4-50 was the left side of the W. The right side was 82110. That low was a low in April, early April, right? Came up the right side. Basically, it's gone straight up since. Had one or had three down days in the entire month of April. Wow. Broke out of the middle of the W, 99870. Broke out above it on, I think the day they reported. No, a few days after they reported. On the 21st. Okay. Close the lower half of the range that day.

And it's been up every single day since. Wow. One of the strongest stocks in the market right now, growth stocks. Right? Strong earnings. You know, their quarterly earnings are growing double digits. Their annual earnings are very impressive. in 2020, the company made $6.08.

In 21, earnings soared to $11. In 22, it went to $9. Okay, not growth, but that's okay, because things slowed down after COVID and all that craziness. 23, earnings jumped to $12, higher than $21 at 11. And then 24, earnings came in at 1983, and 25, earnings are expected to grow by another 30%

to $25.51. 26, earnings are expected to go to $30. $30.93. Wow. Wow. But look at the chart. Double bottom pattern broke out and took off. If the market's going to resolve itself and go higher, and I'm not saying that's what's going to happen, I don't, nobody knows what's going to happen with absolute certainty, but you put the pieces together. And if we roll over and fall, bye, bye, you get out of the way. And we don't even have an all clear. You know, I had a guy call me today. He's like, hey, can I buy the three, two? times long, you know, market, ETF, blah, blah, blah.

I said, we're below the 50. We're below the 200 day. Now, could that trade work out? Sure, it could. Again, for a trade, not for a long-term investment, but for a trade. Yeah, do whatever you want. With risk, that's the key. Respect risk.

But it's not all clear. We're below the 50 day. We're below the 200 day. If this is indeed the bottom was in April, and we're going to continue to rally from here and we'll get trade deals and, you know, there is no recession or it's a very shallow recession and then we have a very strong second half of the year and earnings are expected to grow and everything's hunky dory, great, the market's going to tell us. The action's going to improve. More areas in the

market are going to perform better. The semiconductor stocks are an important area that have been lagging recently. We'll see them wake up and get their mojo back. We'll see the biotech stocks, health stocks have been under pressure recently. The XLV is the health ETF. Biotech is XBI. See them come back to life, right? Possibly. Financials are already starting to improve a lot from where they were just four weeks ago. Again, end of month, I like to zoom out and look at the forest. All right. Again, individual stocks. Do we see more stocks like Netflix, break out, hit new highs, or do we see stocks like United Health, UNH, gap down after reporting earnings, and really, and do they keep falling and just get crushed?

You know, time will tell. It's one day in time. And Gary does a phenomenal job staying ahead of this for everybody and does it daily. The NASDAQ 100 as of today's closed. today's close is down about 12% from its 52 week high. And now it's on track for its third up week in the last four. The S&P5, again, we have to see where we close on Friday. We have a lot of earnings coming out tomorrow.

You've got Amazon, you got Apple. You've got, I mean, hundreds and hundreds of stocks going to be reporting in many big ones as well. And then you have the jobs report on Friday. So this is not, again, not a slam dunk. All it is is like, okay, it's. It's a good day today, right? But for stepping back, for just seeing where we are at the end of the month, for just a farest kind of point of view, this is a correction now.

We barely went below the 20% level and we got right back above it. So okay, the market's in a correction. The S&P 500 is down 9.6% from its 52 week high. That's a good sign, right? The Dow is down about 10% from its 52-week high, correction territory. The pullback is 0 to 9.9%. Correction is 10 to 19.9%. And then a bear market is over 20.

Typically, that's how they define bare markets, corrections, and pullbacks. Again, pullback is 0 to 10. 10 to 20 is correction. And then over 20 is a bare market. But that's a good sign. But as we go down, the market cap, totem pole, the midcaps are down 16.5%. 16.6% from a 52-week high. But they're up four weeks in a row, rallying right into their 50-day moving average.

We'll see what happens there. The Russell 2000, IWM, the mid-caps, by the way, ETF is MDY. The Russell 2000 is IWM. And that's about, it's recovered a lot, up four weeks in a row also. That's 20.5% below its 52-week high. It was down almost 30. Maybe right near 30. I don't know the exact number.

but mid-20s and now you're down 20.5% clawing its way out of that deep hole it was in. You're still down, still below the 50s, still a lot of room to go, but it's a day. It's getting better. And it's not just one day.

The last two, three weeks, we're seeing the last week or so a change, like Gary says, in complexion. So we'll see. And if we roll over, bye-bye. Defense, defense, defense. We're still in a downtrend.

We're still in a correction. This can easily roll over, folks. All I'm just saying, big picture, zooming out, it was a strong month. Up next, we've got a lot more to cover. I'm Adam Sarhan. This is the one and only Investor's Edge. Guys, it's no use putting it off. The best time for an underwear refresh is now.

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well, more microphones. Start your show today at spreeker.com. Spreaker, because if you're going to talk to yourself for an hour, you might as well publish it. You're listening to. What are we waiting for? Well, what are you waiting for? One, two, ready, go. Investers Edge with Gary Culpa.

And welcome once again to Investor's Edge. I'm Adam Sarhan, in for Gary Kay, who's out today. In case you're just joining us or missed any part of the show, you can go to GaryK.com. Rewind, fast forward. Listen to any device for free anytime you want. All right. So, spoke about GDP in the morning, spoke about a big positive reversal for the day. Also, last few weeks, the complexion is improving big time or bigly any word you want to use, right? That's a good sign for now.

More cards have to come out of the deck. We have Amazon, Apple, lots of other stocks are reporting earnings. and we're going to pay attention to the big ones, and we're going to pay attention to how the market reacts to the news. We had bearish news this morning. GDP contracted, fears of a recession, kicked in, stagflation kicked in, inflation's higher in that GDP report. Market didn't care. Well, first off, it opened lower, so it did care at that point. But really, by the end of the day, Bulls emerged somewhat victorious here.

Had a strong day because it closed the upper half of the range. For the month, at the end of the month, guess what? Same thing happening, open, lower, closed, higher. It depends on the index you're looking at, but closed mix to higher. When people ask me, oh, how do you listen to the market, Adam? How do you make sense of what's happening? Here you go. A subtle sign, there's lots of ways, but here's one important way.

It's just look at the price. Price going up, that's Bueno. That's good. Price going down, no Bueno, right? For the Bulls. That's good for the Bulls, and that's not good for the Bulls. All right. So when you open lower and you close higher or in the upper half of the range, that's a subtle but important sign that the bulls have a little bit of an edge for that period of time.

Daily charts, weekly charts, monthly charts, intraday charts. It doesn't matter on the time frame. The longer the time frame, the more powerful or the more oomph it has, for lack of a better word, the more importance it has, the more weighting it has on the longer timeframes. but a weak open followed by a strong close or upper half of the range close, think of a game with tug-of-war. It shows you that the bulls have a slight advantage. And the opposite is also true. If you have a strong open and a weak close, that shows you the bears have somewhat of an edge. Not it doesn't have to be, but somewhat of an edge.

Okay, great. When you have a situation on a monthly basis, you did that, right? You did it today on a daily basis, and then you put another layer on top of that. When you get bearish news and you don't sell off and you're in a correction, guess what? That in and of itself is very impressive. And that's what I mean by a strong month, strong day. It's okay. The fact that we're closing the upper half of the range, that's a strong sign.

Doesn't mean we have to go higher from here. Doesn't mean we can't open tomorrow and gap down a gazillion points because they enter any headline you want. No. All I'm saying is that it's another bullish card that came out of the deck. The fact that the reaction to the news is what really matters. And it was a good reaction today where you sold off hard and closing you upper half of the range. Depending on the index you look at it or the market or the sector you look at it or whatever it is. Okay, great. That's a good subtle sign of strength because I'm getting asked all the time. Adam, how do you know if the stock's strong or not strong? Well, just look at the price. Is it going lower left to upper right? Again, respect the trend.

Right now, this is a correction. Most corrections end. Most corrections, even if you dip into, you know, down 20% or down 25%, for a short amount of time, like what happened this time, don't lead to new huge bare markets. And we've already seen the White House pull back a lot from their stance on terrace. Not a mistake because the market went down so much. Okay. Well, if they reverse their stance again or change their mind again or. do get trade deals or or or or you know they gave a 90 day extension what if they give another 90 day

extension you follow that's six months two 90 days in a row or you know three months and three months so when the facts changed the market fell biggest tariffs and you know the liberation day and all that kind of stuff and then all of a sudden that was dialed back markets started going up again so we'll see but for now what I want to say is that when you look at markets you look at your stock Ask yourself, how am I aligned or not? How am I performing? What I was going to say? But how am I aligned?

Or do I find myself fighting and struggling? That's a good sign for me to see whether or not I'm on tilt or not on tilt. And that's a term that they use in other industries where it's like, oh, you're a little off. You're hot or not. You know, think of basketball. They have the playoffs now. Okay, great. Someone has a hot hand.

They're just firing on all cylinders. Okay, great. They're not hot. It happens to the best of us. Any performance-based business, which this is a performance-based business. You have the potential to make unlimited money on the upside, virtually unlimited money, you know, no limit. And you have the potential to lose all your money, and then some, which happens you see people do both, right, in between. But you get paid to perform athletes, performance-based business. Michael Jordan can literally show me what he does shoot a basketball, I'll have a complete different shot. His heights different, his bones are different, his eyes are different, his sense of experiences different, so on and so forth.

Athletes, you know, athletes perform, you can look at actors. Same thing. George Clooney can sit here and tell me how to act and show me exactly what he does. I won't be able to do it the same way he does. So in a performance-based business, a lot of the performance depends on how the person or the user upgrade the user, how the user performs. So my focus is when I find myself on tilt or off or cold streaks, and they happen to everybody, just back off. I don't fight it. Let some time pass and then come back. And when you come back, you come back fresh. When you come back fresh, guess what? You get to reset. And the time off and all that kind of stuff, it varies depending on everybody. but being able to handle those cold periods and not fighting the market is Muay and portanto super important.

Why? Because you don't want to dig a hole. If you're digging a hole, stop digging. You know, Buffett has two rules of investing. One, don't lose money. And rule number two, don't forget rule number one. We're in this business to make money. If you have a huge drawdown or a huge, you know, you start digging a hole, which has happened to the best of us. I've done, I've bankrupted my accounts. Jesus, four, five, six, seven, times 25 years ago or so, more than 25 years now, thereabouts, multiple times. And I've seen countless people do it. And the biggest, I've seen people recover. I've seen a lot of that, most people don't, because PTSD, the psychological trauma that comes from that losing your

money is extremely painful and difficult to deal with. You can avoid that by taking small losses and not letting those losses get too big. And when things aren't working, dial back a little bit. know yourself, know thyself, right? And find out what works well for you and try to stay in harmony with the market. I hope this is helpful. I believe that's all the time we have for today. I always want to thank you very much for being here.

I believe Gary be back tomorrow. It's another day. So tomorrow's a new month. Thank you, everybody, and I'll speak to you again soon. This has been Investor's Edge with Gary Cultbaum on BizTalk. To listen to past episodes or to get in contact with Gary, Go to GaryK.com. That's GaryK.com.

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