Rebound Territory: Get Your Biggest Gains Here…
Yeah, it’s been a wild ride in the markets, but you embraced it with Strong Hands.
Good thing too. Because OUR America 2.0 stocks are making big rebounds and you kept eyes on the big picture.
Since November, the market’s actually taken off, leaving indicies like the S&P 500 in the dust.
And it’s all thanks to our mega trends and growing America 2.0 industries — such as 3D printing, space, new energy…
So, check out this week’s IanCast to find out more about those sectors and:
- Crypto: including stacking mega trends between bitcoin and solar energy! [17:28]
- Marijuana: What’s new in cannabis legalization and what that means for pot stocks. [31:40]
- Telsa: Tesla’s autopilot system and our outlook on the future of TSLA stock. [37:50]
The Growth Stock Correction is Ending
Paul: Let’s start with the stock market. My sense is that the growth stock correction is done or mostly done. What do you think?
Ian: I agree. I think it’s done. We saw a huge bounce on Wednesday in a lot of these stocks. 3D printing, a lot of marijuana stocks were up, solar stocks have bounced 30% or more off the bottom. It was just a three or four-week bottoming out process, which is super painful to sit through.
I think the bottom is in on all the stocks we focus on. Things are looking way better.
Paul: Our colleague Patrick Goodrich texted me and he was seeing good things in the IPO market, which is also a good sign.
Ian: For sure.
Paul: There’s a lot of different signs. What about call data?
Ian: Yesterday was the strongest day I have seen in a month at least. Things are looking up in the options market and we’re definitely getting confirmation in the stock market. Today — we’re recording Thursday — it looks strong too. I think the call data is going to be even better once the day is over.
Paul: Also, I do my checks in the morning where I go through every company announcing any significant event. There is a lot of action going on in the premarket that was missing for weeks and weeks. The premarket action was limp at best.
Last week we talked about cloud and semis. Any other sectors you are seeing where it does look like the folks who were looking to cash out where we are seeing buyers now come in to buy stocks?
Ian: Cloud is still looking strong. Semis have been strong the whole time. New energy, some of those stocks are starting to move up big time. Also, online retail is starting to bounce. 3D printing and cannabis got hit the hardest and they are starting to bounce too.
3D-Printing Stocks Are Rebounding
A lot of them were down 60% or more from the top. At some point the selling has to end. I think it’s over and the stocks have bottomed out.
Paul: I agree. I went and looked at 3D Systems, which everyone knows is in the Profits Unlimited portfolio. I will spend a second to plug Profits Unlimited, which is our flagship newsletter. It goes for $47 in the link in the description.
If you are interested in investing in America 2.0 and Fourth Industrial Revolution, that’s all we do. We don’t mess around with income stocks, value stocks, trailing stops — we are in for the long term. We focus exclusively on innovation, technology, the rise of the millennial generation and gen Z.
In other words, futuristic, opportunistic, growth oriented stocks. We’re exclusively focused on them. If you are interested in that, go to the link below.
I actually sent a trade out today in biotechnology. It’s interesting seeing what kept its value. You mentioned 3D printing. 3D Systems had a 1,000% move from bottom to top and then dropped about 70% from peak to current bottom. I agree it feels like a bottom.
However, at the end of that it’s a $2.6 billion company. This thing is like an ant in the world of Apples, Microsofts and Amazons. Yet, it’s the category leader. We have chatted about some of these things. It’s an unusual thing that is unique to this market.
Most people look at 3D Systems price and market cap and think $2.6 billion is a large number. Ian, with your crypto riches, if you had $2.6 billion it would be a large number. But just give people some sense of how tiny this thing is. If you put all 3D printing stocks together what would you come up with?
Ian: All the 3D printing stocks together are probably under $10 billion. Somewhere around $10 billion — $15 billion max. It’s absolutely tiny. To put that in perspective, that’s one one-thousandth what Apple is worth. Microsoft is also worth more than 1,000 times this entire industry, which is the future of manufacturing.
It extends into pretty much every industry where things are made. To put that kind of comparison out there, I think it’s insanely undervalued. The big rally we saw in 3D printing stocks at the end of last year and beginning of this year was not a fluke at all.
I think those highs are going to be taken out. 3D Systems, which didn’t even make a new all-time high during that, is not going to have a problem making a new all-time high. It might take a year or maybe a couple years, but at some point these stocks are going to breakout big time.
Paul: It’s going to be a case of slowly and suddenly. Folks who are looking for short-term trading, in-and-out trading, we are not for you. We are looking to make big money. We think 3D Systems can go back to its old high and then go beyond it.
Even once it goes beyond it, given how pervasive we think 3D printing will be, it will still be cheap even at the old high.
Ian: This is going to be a multi-trillion-dollar industry and right now it’s worth a tiny fraction of that.
3D-Printing and Transportation
Paul: I did my Bold Profits Daily on Tuesday about urban aviation. We have talked about companies like Joby. I have no fixed number, but what would you guess the 3D printed part percentage is for their industry? All of those have to be 3D printed for the most part.
Ian: A lot of them do get their parts 3D printed. It’s going to be an increasing amount. With the whole electrification of transportation, a lot of that is going to be 3D printed. I have seen a lot of electric car makers float that idea out there, even Tesla.
It’s not going to be long before we see way more information about Tesla with 3D printed cars and public transportation could be 3D printed. Another thing is space, like rockets. There are companies that are fully devoted to making a 3D printed rocket.
Transportation is just one of the many industries that 3D printing is getting into.
Paul: I forget the name of the company. It’s either Relativity Space or Rocket Labs, they are looking to 3D print an entire rocket. While these companies are crazy cheap, there are entire industries forming around being able to use this technology.
You mentioned electric vehicles. It would make those parts cheaper and lights. Then there’s urban aviation with its eVTOL market. Then there’s space. As usual, when stocks spike up and then go down, I get my share of spicy questions on Profits Unlimited.
You put out a price target of trillions of dollars — we’re not guaranteeing this, I just want to make it clear. We are not financial advisors. You may not take something we say and bet everything you have on it. It’s really to promote our services. It’s meant to be for information and engagement.
Maybe on some level entertainment. So anything we put out there on price targets, this is not financial advice. This is two people talking on YouTube. Think of it that way. 3D Systems is about $20 today. I could easily see this being a $26 billion company. I don’t even think that’s a stretch.
How far would you go?
Ian: If they really maintain the dominant position in 3D printing, I think maybe $100 billion. It would put their stock at almost $700.
Paul: And that’s just pure market capitalization. If they are a leader of a large and growing industry that is spawning new industries that are dependent on that technology, it’s going to be a very large number.
Whatever gains or losses people have seen in the short term, for you to be using our services you definitely need to be, at minimum, signing up for a one to three-year time horizon. Days are insufficient. Weeks are insufficient. It needs to be in years.
I’m just saying this because so many of the questions that we get on YouTube and across our services have to do with this issue. People’s timeframes are simply different than ours. There are many people with timeframes that are shorter than ours and we guide you to them.
If you are willing to open it up, we’re talking about $20 to $700. That’s huge. I don’t think it’s going to take 20 years either.
Ian: They are the leader. They are one of the biggest market caps. There are also some that are way smaller, less than $100 million. They are doing big things. Those are going to be multi-billion-dollar companies some day. The opportunities in 3D printing are huge.
It’s definitely something to take advantage of.
Paul: That’s just an example of America 2.0 and Fourth Industrial Revolution stocks.
One thing I have been tracking since the crash last year in March was the equal-weighted S&P 500 versus the cap weighted. There’s no quiz today, but it’s a pretty large difference at this point. It’s actually in excess of 20%. Then go down a little further and go out to broader indices.
The Russell 2000 is 128% versus the S&P 500 at 89%. The Nasdaq Composite is at 105%. The QQQ which have a lot of big tech companies like Microsoft is up 99%. Even with all this, while our stocks took a hit, overall the health of the market was still there.
There was no panic selling of any kind. Did you see any panic selling? I know there was panic among folks who own our stocks, but did you see places where people were just selling everything? I guess 3D printing was one place you kind of did see that.
Fear Sellers vs. Long-Term Investors
Ian: You wouldn’t be able to tell if you looked the S&P 500. In some sectors there was panic selling for sure. There are so many buyers at this level that it’s not going to be too long before these stocks start to move back up.
Paul: The primary issue is for people who just started to buy in November. The S&P 500 year-to-date is about flat. The equal weight is up about 5%. The Russell 2000 is up 8.7%.
Only the QQQ are down 3%. There’s not a long of long-term sellers who have gotten out. What do you think?
Ian: It was mostly traders, retail buyers, people who got sucked into the hype and had FOMO. I think all the people who bought in January and February during the top who were just trying to make a quick buck have sold. I think that’s what we’ve seen in the past couple of months.
Paul: Many people ask why I didn’t give the signal to sell. Did you expect that run in March to go all the way to February?
Ian: Not at all.
Paul: Right. That run went way further. At various times we thought the run was going to stop all the way back in June. I remember our Slack conversations. It looked at some point in time the rally might weaken. Am I right?
Ian: Yes. And then we had some small dips in there. Everything kept going up and then it started going parabolic toward the end.
Paul: People ask why I didn’t issue a sell. The truth is, when a market is running you want to stay in. Yes, it can lead to a pullback. This is why we have Rules of the Game. We tell you to take profits on the way up. On the way up definitely means it here. It always feels worse to take profits as things are declining.
Ian: It’s easy if you buy something at $10, you see it go to $20 and you sell. Then it keeps going up and you buy back at $50 and it has 20% more and you end up losing. There’s definitely a psychological aspect to it. It’s better to hold on in the case like this where these companies are transforming entire industries.
It’s not just going to be a one-year rally.
Paul: They are making new worlds effectively. This is what 3D printing is doing with respect to space. We are looking to conquer another planet. This is never going to unfold in a day, a week or without significant volatility. Significant volatility means a minimum of 20%.
These are not going to be nice, well-organized, thoughtful dips. They are going to be violent and difficult in some cases. Which is why we point people to Rules of the Game.
Let’s move on from stocks after saying we think this is definitely near the end and we are bullish, optimistic, positive — BOP — on Fourth Industrial Revolution and America 2.0 stocks.
The Mainstream Media, BTC and New Energy
I have to believe the mainstream media is in cahoots with General Motors and ExxonMobils of the world. They all hate BTC somehow.
They hate Tesla. They hate BTC. Cathie Wood at ARK Invest has been pretty much right about everything for the last five or seven years. They have done work on BTC and they are saying that, opposite to what everyone is saying, BTC actually encourages the use of solar power and alternative energy.
Ian: I have heard that before. Obviously not from mainstream news outlets. I have seen a ton of articles about BTC miners being powered by solar or wind. It’s getting more and more widely adopted. Every day the amount of power required to mine BTC grows.
Every single block that’s mined, which is about 6.25 BTC, is more difficult than the last. You need more power as time goes on. As solar and wind and alternative energy gets more widespread, cheaper and more available, I think BTC miners are definitely going to use it as much as possible.
Paul: I know a couple of miners. One person mines Ethereum (ETH). The other mines other things but also BTC and ETH. They actually use solar power because they are trying to make it as cheap as possible. They also use the heat their mining rigs generate to heat their house.
Actually, one of them is using the heat in his farming operations. I think what they are talking about is true.
Ian: It lets off a ton of heat that can be converted to energy. I have seen big mining operations, for example Hut 8, they just partnered with a company to try to figure out what the best way is to use all that energy that is let off.
Then you would be able to not only use solar power to power your operation, but you could also use leftover heat to power something else. I think it’s a great thing for the energy as a whole.
Paul: I don’t know why there is so much FUD on all the things that have the most future benefit. People talk about how Tesla still needs to burn gas. It’s so much more energy efficient that an internal combustion engine. That claim is laughable. Yet, the media will put that out there.
For a long time they put it out there. They will name a country and say BTC uses more energy that that country. Then if you dig into it and use actual facts and figures and consider where the world is going and it’s completely bogus.
Ian: They never tell you how much energy is used by Exxon and GM.
Paul: That doesn’t count. Nobody gives you a number when they cite the other FUD on crypto where they say it’s used for illegal purposes. That has to be a joke. Many people write me and ask me. Break it down for them. Why is that a joke?
Ian: I have seen stats on this. I can’t remember the number off the top of my head. I know the amount of BTC used on the dark web — buying illegal things, money laundering, anything like that — it’s a tiny fraction of 1%. Not only that, it’s fallen a lot since 2014 or so when BTC started going mainstream.
Not only that, but fiat currency is basically the medium of financial crimes around the world. They never want to bring that up either. They hate BTC. They give these arguments that are surface level without any rebuttal. It’s almost like there’s a bias.
Paul: The person who runs the banking system in Europe talks about regulating crypto. Do we have numbers on how much cash is used in illicit drugs? They must have a secret blockchain where they can make this claim. Yet, in the existing financial system where there are scandals every month about money laundering, drugs and all kinds of bad things.
It’s frustrating as two people who are crypto advocates to see this argument continue to get play and even our readers come at us. We’ll move on from there. You brought up a story about Jackson, Tennessee. The mayor is Scott Conger. He says he plays to begin using crypto within the city. What do you think of this?
Ian: That’s something that I didn’t even expect yet. It’s one thing for companies to buy BTC and crypto and put it on their balance sheet. It’s another thing for a town to center themselves around BTC mining. I think it’s cool. We were talking about how it can provide energy.
You can heat people’s houses off the mining operations. I think crypto towns might end up being a thing at some point. It can definitely drive a lot of small town economies.
Paul: It would be obviously bullish for BTC, ETH and the general adoption of crypto. If it works for them then other people are going to want to do it. I recently had the experience of having to use the banking system. I can tell you it was a horror show.
Ian: Every single time.
Paul: I have a question. We have ETH making new highs, yet BTC is not making new highs. What’s your view on this?
Ian: ETH is kind of a different game. It’s kind of the economy of the digital world. BTC is the store of value or the reserve asset of the digital world. That’s what it looks like to me. They are going to move differently at different times. ETH is newer. Not as many people have it.
It hasn’t gotten to the adoption level of BTC. It will have price swings in both directions. I am very bullish on both of them in general.
Paul: Throw out your price targets just to remind people.
Ian: For BTC my prediction is it will hit $115,000 by August, which is coming up in a few months. I think it’s going to rally again soon. BTC will hit $350,000 during this bull market in general. ETH I think will hit $8,000 during this bull market.
Paul: My price target for BTC is $250,000 over the next one to three years. For this year, it seems like a no brainer now, but ETH will hit $4,000. I can say when I initially said it, it had more surprise factor to it. Now $4,000 seems certain.
I got this question on Profits Unlimited and I will pose it to you. One subscriber wrote and asked how many corrections I expect on the way to either one of our price targets for BTC. I didn’t give an exact answer. I wonder if you have one.
Ian: I think the volatility is not what it was in 2016 or 2017. I think that will be the case going forward. It will still have a lot of volatility compared to the stock market. In 2017 it had six 30% drops. This year it has had three or four 20% drops. I think a correction will happen and then we will go on a long run.
Then we will get a couple more corrections before it really breaks out again, which is what has happened since February. I would say maybe 10 in a year with the correction being 20%.
Paul: I think that can happen. This is a decentralized market. There are no market makers. If someone wants to come and dump 100 BTC and puts it in Binance or Kraken and actually shows it, the market is going to react. It’s not going to be 2%. They are going to take a haircut.
What would you guess? If someone put 100 BTC on Kraken, Binance or Coinbase Pro which is similar to that — Coinbase would mitigate it — but what would you say the price impact would be on the market if someone wanted to sell 100 BTC?
Ian: If it was on a more liquid exchange it would have a lesser price impact. If it was on one of those big ones, probably at least a few percent. Then that would cause a further selloff. In the meantime, everyone who is way overleveraged will get wiped out. It will have a snowball effect.
Paul: It’s interesting. In 2017 you could barely sell a hundred thousand in BTC without moving the market. Today, you can sell millions. This market has moved a great deal. We are just waiting for the next company to say they have been buying. You know for sure someone has been buying this dip.
Ian: Constantly. It’s not just individuals anymore. It’s company, it’s towns and it will just get bigger from here.
Crypto Flash Trader
Paul: Let’s update folks on what’s going on with your crypto service you are going to be leading. Readers can get on the Crypto Flash Trader waiting list to receive free content until it launches to the public. Based on our publisher’s estimates, we are a few weeks away before we can give you firm dates. Nonetheless, it’s going to be an awesome service.
I continue to see the beta trades. Let’s give a general update on where the trades are and what the record is.
Ian: The record for the trades we have sold is still undefeated. I think we are 23 and 0. We just took a profit on our most recent trade this morning. We have at least 15 trades open right now. There’s a lot we are doing to get a better understanding of the market.
We’re doing really well so far. Most of those open trades are also up. Win rate, if you count all the open and close rates we are above 90%.
Paul: So beyond exceptional skill, which I know you have from knowing you a long time. What’s driving these gains or the trades?
Ian: Obviously recently things have been more choppy, but in the beginning of the year there was a wave of buying. I think there was a lot of anticipation about 2021 being the year of the crypto bull market comeback. It definitely has been. We’re starting to see some of the older coins go up that were big in 2017 that were falling behind.
I think that’s a really good area to buy right now. Also, the newer leaders have established themselves already. I have brought up Uniswap before. It’s the biggest decentralized crypto exchange, totally run on ETH. It’s the most popular app on ETH.
Chainlink is another one that provides pricing data to every single app it seems like. There are definitely leaders being cut out right now. Also, older coins people might have been wary of buying back into because they lost a lot in 2018, those coins have survived.
Those projects that have survived I think will surge back up for sure.
Paul: All of these trades are coins that are Coinbase? At least recently. Maybe earlier on you had some coins that were not on Coinbase.
Ian: Yes. Earlier I did, but I am sticking to Coinbase for sure for now.
Paul: It’s the easiest platform. And Coinbase is constantly expanding the number of coins on their platform. Also, if you are on the list we are going to start sending out simple videos of me and Ian walking you through Coinbase as a platform and what it’s going to look like.
So when we launch you will be ready and prepared to use the trades we send out. Let’s close the crypto section by telling people we are BOP on crypto, BTC, ETH. An explosion of value and gains are going to come through crypto.
Cannabis Stocks Hit a Bottom – Will They Rebound?
Ian: Exactly. They got crushed the past couple of months, but a lot of them are still up a lot for the year. ETFMG Alternative Harvest ETF (NYSEArca: MJ) is still up more than 50% for 2021, even after that crash. Just like 3D printing, the run that these stocks had before was so big that you can’t sustain that for long.
There was profit taking combined with panic selling from people who got in near the top. They had that FOMO and bought in at a price that was up hundreds of percent and they couldn’t help it. When that happens, people usually get wiped out. That’s what happened in pot stocks.
I think now they went way further down than was reasonable. I think we will definitely see a bounceback. I think those will make new highs as well.
Paul: I agree. Stocks always go up more than you can imagine. Also, after they hit their peak they can go down much more than you think. This is why we tell people it’s so important to use Rules of the Game. You have to have some money management rules.
Otherwise, you constantly end up buying at the high and selling at the low and being in a cycle that’s opposite of where you need to be. I saw this news article. They are discussing legalizing marijuana in Congress. The Democrats have full control of the House, Senate, etc. are unable to rustle up the votes to get this passed.
This seems to be a no brainer. I don’t understand what the issue is. The polls tell you this is a bipartisan issues. 70% of people when polled consistently say marijuana should be legalized. There are many civil rights implications from people who have been jailed for marijuana cases.
It makes so much sense in every respect and yet there are still only discussions going on. What’s your timeline for national, federal legalization?
Ian: I thought there would have been more progress by now. Like you said, it does seem to be bipartisan so I’m not sure how they can’t get the votes. I would give it definitely within the next two years. I think there’s a good chance we will have federal legalization.
It wouldn’t surprise me if it happened this year. It’s like everything else: It’s slowly and then suddenly. There will be talks for a while and then there will be a huge momentum buildup and it will get done. I do think there’s a chance that could happen this year.
Paul: Texas has introduced a piece of legislation for it to be legal in the state of Texas. It would be huge. The volume needed to fulfill the needs of that state would be crazy.
Ian: A big percentage of states have legalized. You are seeing governors be fine with it. I don’t know how they are not getting the votes.
Paul: We are taking way too long with this. Everyone agrees for the most part. The objections for it, the long-term data and information shows that whatever you can say about marijuana you can say about alcohol. What do you think?
Ian: I agree.
Paul: We are BOP on cannabis. Just give folks your prediction for MJ, the cannabis ETF.
Ian: I think MJ will hit $40 this year. Right now it’s around $22. There’s still upside from here. It almost hit $40 earlier this year. Like I said, I think they are going to bounce back and go even higher.
Paul: Once again, anything we recommend buying into is intended to have a timeframe at minimum 6 months, 9 months, 1 year. We are definitively not in the day trading game. Whatever Ian says about the cannabis ETF, consider that before you go all in.
Tesla’s Autopilot Accident vs. Amazing Safety Track Record
I’m sure you have heard about this crash that has gotten a lot of publicity. Just to set this up for you, the folks driving this car put the car into Autopilot and based on what was found at the accident site there was a person in the passenger seat and a person in the backseat.
In other words, there was no one in the actual driver’s seat itself. Which owning a Tesla I can tell you is a violation of the terms of service of using Autopilot. It specifically says you need to be prepared to take control of the car at any time. There’s an alarm that goes off every 45 seconds or so if it senses your hand is not on the steering wheel.
It senses it by the amount of pressure you put on it. What do you make of this? Tesla seems to get targeted for this. If I were to go through accident statistics my guess is there are hundreds of accidents per day of people who are not looking at the road because they are doing this.
Paul: Yet, Tesla has one accident and everyone is talking about how the world is going to end, no one should use it. All while the safety track record is amazing.
Ian: They have an amazing track record. You know they want to cover every accident possible. I don’t remember the last time I heard about a Tesla accident in Autopilot. They are few and far between. In my opinion it’s overblown that you shouldn’t use a Tesla because of this situation.
Paul: Here’s a number that was researched by someone who was not trying to do clickbait. The statistics for Tesla are mind blowing on the side of safety. There is one fire for every 19 million miles if you drive an internal combustion engine. I have been teasing you all IanCast and this is the quiz.
What do you think that number is for Tesla? Just to repeat, there is one fire for every 19 million miles in an internal combustion engine using aggregated statistics. What is the similar number in terms of miles for Tesla? Is it under or over? If it’s over it’s safer, if it’s under it’s less safe.
Ian: I feel like this is going to be low but I will say 50 million miles.
Paul: It’s 205 million miles. In other words, it’s not even on the same planet. Cars on Autopilot are so much safer. Yet, you would never have that impression by reading the news.
Ian: And you’d never have that impression that Tesla did anything good in general by reading the news.
Paul: What about their stock price? I’m guessing a lot of people are in and I’m guessing we had quite a lot of buying that happened post-November. What’s your view on Tesla stock price?
Ian: It’s held up better than a lot of other America 2.0 stocks, which is a good sign. I see Tesla as the Apple of America 2.0. It’s the bellwether. When Tesla is strong it seems like a lot of growth stocks are strong. This bottomed out sooner than a lot of other growth stocks.
Especially alternative energy, which is good because that’s the one I would associate them the most with. I think Tesla looks strong and that’s a good sign for America 2.0 stocks in general.
Paul: 100% agree. I think with some of this correction or whatever you want to call it, one of the areas that was super hyped was anyone who claimed to have an EV. I think some of that has gone away. If they are looking in the same sector they are going to the leader, which is Tesla.
Editor, Rapid Profit Trader