☕ What’s next, dead cat bounce or?
Feb 06, 2026Good morning! 👋
The markets appear to be gaining some footing this morning with all three averages in the green as I type.
Is this a “dead cat” bounce, the start of a new rally or something else?
I could make the case for all three.
My gut – and, for what it’s worth, 45+ years in global markets – tell me that there’s still some wiggle room.
Bottoming is a process, not a light switch.
Here’s my playbook.
1 – The one chart to see if you’re worried about tech
There are very, very few moments in time when the markets hand you the kind of gift smart investors are being handed right now.
The companies on my shopping list have spent billions changing the world and will spend billions more to ensure that they succeed.
If you really think that the very best names are going to collapse, great.
Chances are good that I’ll be one of the first in line for your shares.
Keith’s Investing Tip: Profits are always found at the edge of absurdity.
2 – And just in case you don’t “buy” what I’m saying – pun absolutely intended
Nuff said.
Take a hard look at this chart, too.
But you absolutely DO get paid to invest.
Keith’s Investing Tip: It never feels like a good time to do that – invest – but history shows very clearly that it almost always is if you pick your bets carefully and use the right tactics every step of the way.
3 – Amazon v Walmart
Amazon didn’t exactly knock the ball outta the park this quarter. Top line estimates beat but bottom line missed. (Read)
I’d rather own Walmart.
Not that this is new.
In fact, I’ve been saying for a while — including last year on air with Varney — that Walmart is coming after Amazon’s asteroids. Walmart is very much a tech company that happens to be in the retail business.
Why?
- Better relative and absolute upside
- Better downside protection – beta of 0.67 – meaning it tends to fall a lot less when the market gets ugly, stabilize first, and roar higher more consistently (which dramatically boosts risk-adjusted returns over time)
- A clearer path to investor reward over the next cycle
People want to debate with me all the time about my choices.
Excellent.
The fact that we have different opinions about the same stock is what creates opportunity. 😄
Walmart has returned 26.19%, 184.37% and 185.99% over a 1-year, 3-year and 5-year period compared to Amazon’s -14.30%, 99.94% and 21.87% over the same time period.
If you wanna own Amazon, knock yourself out.
Btw and in case you’re interested, here’s how I select the stocks I do from an interview with the super-savvy Maria Bartiromo earlier this week as the markets sold off. (Watch)
Keith’s Investing Tip: Invest in businesses that are building tomorrow rather than those fighting to maintain their legacy.
4 – Stellantis: almost time to buy? 🤷🏻️
Stellantis shares got annihilated after the company announced a €22 billion reset tied to its EV strategy and broader overhaul. Oh, and they killed the dividend this year too. (Read)
Like that’s a surprise. 🤦
Back in November, I said this: (See #4)
“Many argue that Stellantis (which owns Jeep) is a strong turnaround and a great buy at the moment, but I think that we’re far more likely to see it at $5 before it breaks $15.
LowBalls?”
Seems I mighta been on to something.
Stellantis shares are down ~24% this morning to $7.28 as I type.
I still think $5 might be in the cards but given the dividend news I might be willing to put a line in the sand at $3. LEAPs could be a good play if it drops that low too.
Not for nothing but there isn’t a dividend this year, so the distinction between owning shares and LEAPs just went out the window.
Hmmm. 🤔
5 – It’s “Issue Friday”
Please keep an eye on your inbox if you’re a member of the OBA Family because the February issue of One Bar Ahead® drops later today!
Bottom Line
Don’t chase yesterday’s trends. Instead, position for tomorrow’s inevitabilities.
Now and as always, let’s MAKE it a great day – let’s finish the week strong.
You got this – I promise!
Keith 😀
