Investors Are in Love With Blue Chips and Crypto

|February 14, 2024
Twenty dollar bills making a heart symbol

Can you feel the love?

Investors sure can.

On this most hallowed day of drugstore chocolates and greeting cards, we’re sitting on a 5% year-to-date gain for the S&P 500.

CNN’s Fear & Greed Index tells us the bulls are firmly in control. The S&P is soaring well above its 125-day moving average.

And Wall Street seems to be whistling “My Cherie Amour” as it continues to smother stocks with its affection.

CNN's Fear & Greed

But according to Shah, there may still be some tumult ahead. It’s illustrated right now by the S&P’s P/E ratio.

Per Shah:

The only problem is the S&P 500’s P/E is now 20X, 20 times forward earnings.

Now, there have only been two times in the last 25 years when the S&P has been at or more than 20X on an earnings basis. One time was 1999 and we know what happened then. The next time was during the COVID boom and, well, we know what happened then…

We had trillions of dollars flooding the economy and we had people rushing to the markets. We had traders trading from home, rushing into the markets, and we had an explosion in tech. We got to 24.4 times forward earnings back in 2021.

We’re at 20 now.

The takeaway? There could be a slowdown ahead. Even if the overall picture today looks rosy.

Shah laid everything out in his Monday Takeaways video. Click here to watch it (with transcript).

Spreading the Love

Of course, it isn’t just stocks that are soaking up all the attention…

Cryptocurrencies are back on a tear, with Bitcoin popping above $50,000 for the first time in two years.

The “king of crypto” has more than tripled the S&P’s return so far in 2024.

Interactive Brokers

And Robert Ross says now is the perfect time to jump into the action. But his crypto bullishness isn’t just based on sentiment…

“I have a few indicators I watch closely to gauge investor sentiment in the crypto market and – by proxy – measure where we are in the market cycle,” Robert wrote on Tuesday.

Right now, they’re all screaming “Buy!”

You can read Robert’s piece here.

$500k BTC?

It doesn’t matter if you’re a crypto fan or skeptic. Now that digital currencies and tokens have been legitimized by the SEC, they’re on their way to becoming a significant piece of our economic world.

As investors, it’s important that we understand what’s happening… and why.

Especially now that you’ve got megabanks like Goldman Sachs saying Bitcoin could hit $100,000…

Bloomberg HL

JPMorgan predicting it will reach $150,000 over the long term…

JPMorgan HL

And Fundstrat’s Tom Lee – one of the few to accurately call the 2023 stock market rally – saying we could see $150k Bitcoin in the next 12 months.

Over the next five years, Lee predicts Bitcoin will surpass $500k.

CryptoSlate HL

That may sound crazy. After all, we’ve heard big crypto predictions before. But the bullish calls are growing louder and louder…

And these days they’re not just coming from Twitter (sorry, X). Respected institutions and investors are increasingly weighing in.

As Robert told us yesterday, even despite Bitcoin’s big run-up last year, “we’re nowhere near the top.”

The coming months could be huge for this often-misunderstood sector.

In fact, Robert is pointing to a specific date – April 22, 2024 – as one that could change the course of crypto forever.

That’s when we should see the return of specific catalyst that has already sent cryptos soaring three times before. It’s been responsible for some of the crypto market’s biggest gains to date.

But as Robert explains here, those gains could pale in comparison to what’s coming in April.

Take a minute to get informed on what’s happening… and the opportunity ahead. Click here.